Federal Reserve Bank of Philadelphia President Charles Plosser said he believes the U.S. economy will improve and may prompt policy makers to raise the benchmark interest rate this year.

“The economy is doing a lot better,” Plosser said Wednesday in an interview on CNBC. “We’ve actually seen a pretty substantial firming of growth. We’re entering growth here in the first part of the year on a much firmer stance than last year.”

The Fed may need to raise interest rates “sooner than people expect,” Plosser said. Economic growth increased to 3 percent in the fourth quarter and the unemployment rate fell last month to an almost three-year low of 8.3 percent.

“We could raise rates somewhat and still be at a very easy policy stance,” Plosser said. “One percent is still pretty accommodative.”