[SARASOTA] The low US unemployment rate is the best measure of labor market underutilization, a top Fed official said on Friday, adding that the strong jobs market is a sign of why wage and salary growth is going to pick up.

Richmond Fed President Jeffrey Lacker dismissed the view that slack remains in the labor market, and repeated his call for the central bank to consider hiking rates in June.

Mr Lacker said the intuition of the labour slack argument is that there is a group of hungry workers "chomping at the bit" for a job, ready to jump into the work force.

The cyclical effect of that is "gone now" Mr Lacker said in a question and answer session following a speech here at a Global Interdependence Centre event, citing the retirement of baby boomers and other factors.

REUTERS