San Francisco Federal Reserve Bank President Mary Daly on Monday repeated that she believes two more rate hikes this year will likely be needed to bring down too-high inflation in the face of a strong labor market.

"We're likely to need a couple more rate hikes over the course of this year to really bring inflation" sustainably back to the Fed's 2% goal, Daly said at the Brookings Institution. "We may end up doing less because we need to do less; we may end up doing just that; we could end up doing more. The data will tell us."

The risks of doing too little still outweigh the risks of doing too much, she said, but they are coming into better balance, so it's right that the Fed should raise rates more slowly than it did last year to assess how the economy is responding.

Daly said that to assess progress she looks not only at published hard data like counts of monthly job gains but also at surveys and her own data-gathering, including Sundays spent at local large retailers, personally interviewing shoppers.

Those shoppers, she said, tell her they have plenty of work, but their biggest challenge is that they are less and less able to buy what they need because prices are rising so fast.

That said, she said in reference to a conversation with one young man, she wants to make sure that the Fed doesn't go so far in raising rates that it wrecks the labor market.

"I don't want to take that young man's job, nor to I want him to have to worry about the price of eggs doubling every time he goes to the market," Daly said.

(Reporting by Ann Saphir, Editing by Franklin Paul and Andrea Ricci)