Fed's Evans sees rates rising to 3.25%-3.5% by year-end

(Reuters) - Wednesday's consumer price index report showing inflation didn't accelerate in July was the first "positive" reading on inflation since the Federal Reserve began tightening policy, Chicago Fed President Charles Evans said at an event at Drake University in Des Moines, Iowa.

But inflation is still "unacceptably" high, and the Fed will continue to need to raise rates, he said, likely to 3.25% to 3.5% this year and to 3.75% to 4% by the end of next year.

(Reporting by Ann Saphir; editing by Jonathan Oatis)