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Fed's Bullard says September might be a good time to raise interest rates

St. Louis Federal Reserve Bank President James Bullard, a voting member this year on the central bank's policy-setting panel, told CNBC on Friday that the September Fed meeting might be a good time to raise interest rates.

Bullard has said he favors a single hike in the federal funds overnight lending rate to 0.63 percent and a hold for about 2 ½ years. The current rate, bumped up for the first time in more than nine years in December, ranges from 0.25 percent to 0.50 percent.

"I'm agnostic on exactly when we do that," Bullard said on "Squawk Box." He said he'd like to raise rates for the second time in 10 years on good economic news. "If we got to a meeting and we felt things were looking stronger, that might be a good time to do that."

"We had a couple of good jobs reports here. But year over year, the GDP growth rate is very low, below trend really," Bullard said, forecasting through 2018 economic growth of 2 percent, an unemployment rate of 4.7 percent and inflation right at the Fed's target of 2 percent.

Bullard admitted that bad rate guidance has hurt the Fed's credibility.

Atlanta Fed President Dennis Lockhart said Friday the Fed could hike interest rates at least once and maybe twice before year-end, even in a gradual and cautious approach to policy.

"I can see two rate hikes as possible when I look at the calendar. We have three more [policymaking] meetings this year, so that's possible," Lockhart said on Bloomberg TV from Jackson Hole, Wyoming.

Both central bank leaders spoke ahead of Fed Chair Janet Yellen's speech at the Kansas City Fed's Jackson Hole Economic Symposium. In those remarks, Yellen voiced optimism about the economy and an expectation that interest rate hikes are ahead.

— Reuters and CNBC's Berkeley Lovelace and Jeff Cox contributed to this report.

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