‘Several’ Fed officials want more rate hikes if inflation persists, minutes show

The Federal Open Market Committee (FOMC) released the minutes from its last meeting, which highlighted that the vast majority of participants said that the U.S. economic growth is gradually cooling.

“The vast majority of participants assessed that growth in economic activity appeared to be gradually cooling, and most participants remarked that they viewed the current policy stance as restrictive,” the meeting minutes said. 

Despite this slowdown, the Fed is awaiting additional information before gaining the confidence to reduce interest rates.

The central bank noted that it would not consider lowering the federal funds rate target until more data emerged to provide greater assurance that inflation was on a sustainable path lower.

The FOMC members did not believe it is “appropriate to lower the target range for the federal funds rate until additional information had emerged to give them greater confidence that inflation was moving sustainably toward” the 2% target.

According to the FOMC minutes, most participants found the current policy stance to be restrictive, which they expect will further temper both economic activity and inflation.

The policymakers agreed to maintain the policy rate steady in the 5.25%-5.50% range, where it has been for a year. 

The minutes also revealed a cautious approach among some FOMC members, emphasizing the need for patience before considering a rate cut.

Meanwhile, several members pointed out the potential requirement to increase rates further if inflation showed signs of resurgence.