Fed Vice Chairman Stanley Fischer said in a speech on Monday that inflation will rise toward 2% target once oil prices and the value of the U.S. dollar stabilise.

Fischer pointed out that there was still a link between unemployment and inflation.

"It is sometimes argued that the link between unemployment and inflation must have been broken. I don't believe that. Rather the link has never been very strong, but it exists, and we may well at present be seeing the first stirrings of an increase in the inflation rate--something that we would like to happen," he noted.