Euro lower against dollar at $1.5755

FRANKFURT, Germany - The euro was lower against the U.S. dollar Wednesday after a Federal Reserve official said U.S. interest rates would probably have to be raised soon, regardless of economic difficulties.

The 15-nation euro slipped to $1.5755 in early European trading, down from the US$1.5788 late in New York on Tuesday. The British pound was flat at US$1.9922 from US$1.9920, while the dollar rose to 107.80 Japanese yen from 107.21 yen late Tuesday.

Charles Plosser, president of the Federal Reserve Bank of Philadelphia and a voting member of the Fed's Open Market Committee, said Tuesday the Fed will probably need to boost interest rates "sooner rather than later," even if employment and financial conditions have not improved.

"Inflation is already too high and inconsistent with our goal of — and responsibility to ensure — price stability," Plosser said in a speech to a group assembled by the Philadelphia Business Journal.

A reversal on interest rates "will likely need to begin before either the labor market or the financial markets have completely turned around," he said.

Out of concern about inflation, the Fed in June ended a nearly yearlong string of rate reductions aimed at shoring up the wobbly economy, leaving its key rate at 2 percent.

Higher interest rates can attract investors to a currency as they seek higher returns on investments.

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