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Market Turmoil Cuts Chance of September Rate Hike: Fed Official ’

A Federal Reserve interest rate hike next month seems less appropriate given the recent global market turmoil has increased the risks to the U.S. economy, an influential Fed official said on Wednesday. New York Fed President William Dudley said the prospects of a September rate hike "seems less compelling to me than it was a few weeks ago."

Addressing the market selloff, which was set off by fears that China's economy is slowing, Dudley said he wanted to see more U.S. economic data before making a final judgment on the timing of policy tightening

" Immediately after Dudley's comments on a September move, stocks spiked, but then pulled back. Additionally, the treasury curve steepened, meaning that traders were betting on a rate hike being put off.

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Responding to a question about whether a Fed move will come in a subsequent 2015 FOMC meeting, Dudley said he "really" hopes to raise rates this year, but "let's see how the data unfold before we make any statements about exactly when that might occur."

He emphasized that the Fed's decision-making procedure remains data dependent, and said that data points have largely been positive, but "you also have to look at all the other things that could potentially affect the economic outlook."