The Globe and Mail reports in its Thursday, Sept. 1, edition that the U.S. Federal Reserve will need to raise interest rates somewhat above 4 per cent by early next year and then hold them there in order to bring too-high inflation back down to the central bank's goal, Cleveland Federal Reserve Bank president Loretta Mester said on Wednesday. A Reuters dispatch to The Globe reports that Ms. Mester said in remarks to a local chamber of commerce in Dayton, Ohio: "My current view is that it will be necessary to move the fed funds rate up to somewhat above 4 per cent by early next year and hold it there. I do not anticipate the Fed cutting the fed funds rate target next year." Bringing inflation back down to the Fed's 2-per-cent target would take a lot of fortitude, said Ms. Mester. The Fed currently targets its policy rate in the 2.25-per-cent to 2.5-per-cent range. Ms. Mester also repeated previous comments that she will be basing her decision on whether to back a third straight 75-basis-point interest rate hike next month primarily on the inflation outlook, rather than the closely watched monthly jobs report. Ms. Mester said it was far too soon to conclude inflation has peaked.