* Yellen says economy is falling short in terms of inflation, employment
* Williams says Fed could raise rates by mid-2015 as jobless rate falls
* Fisher: Fed's easy policy could fuel future inflation
By Ann Saphir, Alexandra Alper and Jonathan Spicer
SEATTLE/ MEXICO CITY/ WASHINGTON, March 5 (Reuters) - F ederal Reserve Chair Janet Yellen vowed on Wednesday to "do all that I can" to boost a U.S. economy where unemployment is too high and inflation is too low.
"The economy continues to operate considerably short" of the central bank's objectives of full employment and stable prices, Yellen said at a swearing-in ceremony at the central bank in Washington.
"The economy is stronger and the financial system is sounder," added Yellen, who succeeded Ben Bernanke on Feb. 1. "We have come a long way, but we have farther to go."
The brief comments were a broad reiteration of what she told two congressional committees last month: that the United States appears to be clawing its way back from the 2007-2009 recession but that the Fed is in no rush to tighten policy.
Speaking clear across the country, San Francisco Fed chief John Williams gave a more upbeat assessment of the economy, and suggested that rate hikes could come as soon as next year.
"My own view, based on my own forecast, is that it would be sometime around the middle of next year," Williams told reporters after a speech to students at the University of Seattle. "It could be later or earlier, depending on how the economy does."
Williams said he projects the economy to grow about 2.5 percent this year, slower than he had earlier projected because of the effects of an unusually cold weather, but fast enough to bring down the unemployment rate to 6.25 percent by year's end.
That is down from a 6.6 percent reading in February, said Williams, who was Yellen's top researcher when she ran the San Francisco Fed before moving to Washington as Fed vice chair in 2010.
Next year, he projected, 3 percent growth will likely bring unemployment down to near-normal levels of 5.5 percent by the end of 2015.
Still, he said, because of the lasting damage of the financial crisis to the economy, the Fed may not raise rates all that high, at least at first.
"My own view is that we still have significant, if you will, headwinds to the economy over the next several years that are still slowing growth in terms of demand, relative to trend, so that we need a lower real interest rate, fed funds rate, than you would in say, over history," he said.
The views of the policymakers that head the Fed's 12 regional reserve banks are sometimes at odds with those of the Fed chair in Washington.