The Trump administration's threat of multibillion-dollar tariffs on China makes sense as a way to force Beijing to be more receptive to U.S. firms, Minneapolis Fed President Neel Kashkari said.

"I've seen that basically China does whatever China wants to do," Kashkari said at an event in Minneapolis. "I'm sympathetic with the need to find some way of pushing them to open their markets to U.S. businesses and that's what I think is motivating the current dialogue with China and the current discussion of tariffs."

Kashkari said, however, that the United States must avoid a trade war with China given the impact it would have on the U.S. and global economy and that it was difficult to foresee if the two countries come to a consensus.

"We do need to find a way to level the playing field, but it's very hard to game out where this ends up," he said.

Since the March meeting, Fed officials have largely adopted a wait-and-see attitude to rising trade tensions, noting it is not yet clear if the tariffs will go into effect and their eventual size if implemented.

Kashkari does not have a vote on interest rate policy at the central bank this year. As a voter last year, he dissented from all three of the Fed's decisions to raise borrowing costs.

Policymakers raised interest rates again last month and forecast another two rate increases in 2018, although an increasing number view another three as a possibility.