Fed should raise rates to 1 percent: Fed's Hoenig

A top Federal Reserve Official said on Thursday the U.S. central bank should raise rates to 1 percent by the end of the summer to avoid having to raise borrowing costs abruptly as the economic recovery gains momentum.

Based on the current outlook consensus, it seems reasonable that the economy would be well-positioned to accept this modest increase in the funds rate, Kansas City Federal Reserve Bank President Thomas Hoenig said in remarks prepared for delivery to a business lunch.

Hoenig is a voter on the Fed's policy-setting panel and has dissented against the Fed's exceptionally easy money policies at all three meetings this year.

(Reporting by Mark Felsenthal, Editing by Andrea Ricci)