Charles L. Evan who is the chief executive officer of the Federal Reserve Bank of Chicago has said in recent trade that inflation is very high right now and that's the issue that's top of mind for the Fed.

He joins a chorus of hawkish Fed officials speaking today advocating for rate rise. 

Key comments

''There is a good amount of strength in the US economy.

I suspect the unemployment rate will creep up.

The labour market is still good and will be more challenging with higher interest rates.

We will bring inflation down by making policy restrictive.

At momentum of core inflation, and that's what has us most nervous.

Need a more restrictive seeing of monetary policy because inflation is high.
    
We should have started rate hikes earlier.
    
We have further to go on rate hikes.
    
We are headed to 4.5%-4.75%, likely by springtime.''

I believe the balance sheet reduction will be completely within 3 years.
    
At Fed's next meeting will discuss whether 50 bps or 75 bps.
    
Policymakers are looking for 125 bps of rate hikes over next two meetings.

US dollar update

On Thursday, despite downbeat Initial Jobless Claims, the US dollar rose, extending its gains from the previous day.

Forex has been volatile this week and the US dollar with it. It has struggled to find a clear direction following a dramatic third quarter. On Thursday, the greenback is higher by some 0.8% and back above 112.00. The dollar initially fell against most majors at the start of the week before regaining ground:

The focus is now going to be on the Nonfarm Payrolls tomorrow and then next week, the Fed receives the latest report on consumer inflation.