San Francisco Federal Reserve Bank President Mary Daly on Friday said that while the recent drop in inflation and the gradual rebalancing of the labor market is "unequivocally" good news, more data will be needed to determine whether more policy tightening is necessary.

"The thing that would be a problem is if we decided that we wanted to call it done we'd say we're done, we say definitely one more, when we actually don't know," she said in an event held in coordination with Greater Phoenix Leadership. "Patience is a prudent strategy."

The Fed at its policysetting meeting this week held the policy rate steady in the 5.25%-5.50% range, but also published projections showing that most policymakers expect one more quarter-point rate hike by the end of this year.

Daly did not say on Friday whether she was among them, but did say she is still focused on the "heartbreaking" impact of high inflation, and high prices, on household budgets.

"We will not be satisfied that we are where we need to be until we see inflation confidently, until we're confident that it's on a path back to price stability," she said. "You really asked us to do our jobs, which is to bring inflation back down to 2% and as gently as we can, and that's what we're doing, and that's what the meeting said."

(Reporting by Ann Saphir; Editing by Chizu Nomiyama)