Federal Reserve Bank of New York President William Dudley said three interest-rate hikes in 2017 is a “reasonable” projection and that the central bank may also begin shrinking its balance sheet later this year or in 2018, possibly pausing rate increases in the process.

The median projection for three hikes from the 17 members who comprise the rate-setting Federal Open Market Committee “I think is in a reasonable place,” Dudley said Friday in a Bloomberg Television interview with Michael McKee in Sarasota, Florida. “A couple more hikes this year seems reasonable.”

Fed officials have already increased interest rates by a quarter-point once in 2017, and investors assign better-than-even odds that they will be able to hike twice more before year-end, according to prices of federal funds futures contracts.

As president of the New York Fed, Dudley has a permanent vote on the FOMC and is widely seen as one of its