Federal Reserve Bank of St. Louis President James Bullard said in a speech on Friday that the Fed should start raising its interest rates.

"A prudent monetary policy based on traditional central banking principles would begin normalizing the committee's policy settings gradually, since the goals of policy have essentially been met," he said.

He added that even the Fed starts raising its interest rates, the monetary policy will remain accommodative.

"For those who still think more accommodation is needed--do not worry! Policy will remain exceptionally accommodative through the medium term no matter how the committee proceeds," he said.

Bullard is not a voting member of the Federal Open Market Committee this year.