© Reuters. FILE PHOTO: San Francisco Federal Reserve Bank President Mary Daly poses at the bank’s headquarters in San Francisco, California, U.S., July 16, 2019. REUTERS/Ann Saphir/File Photo

(Reuters) – San Francisco Federal Reserve Bank President Mary Daly on Thursday reiterated that rate hikes will be essential to bring down high inflation in the United States.

Daly has previously said she believes two more rate hikes will likely be needed this year.

Daly wants to start heading towards a neutral rate as the U.S. approaches the Fed’s 2% goal on inflation, Daly said on the CNBC interview.

U.S. consumer prices rose modestly in June and registered their smallest annual increase in more than two years as inflation subsided further. The consumer price index increased 0.2% last month.

“It’s too early to say we have declared victory on inflation”, Daly added.