Federal Open Market Committee (FOMC) June meeting minutes released on Wednesday showed that United States Federal Reserve policymakers agreed that data pointed to a weaker-than-expected slowdown in inflation.
Uncertainty about how their restrictive monetary policy and the recent commercial bank crisis could affect the overall economy led "almost all" Fed officials to consider it "appropriate or acceptable" to keep the federal funds rate at between 5% and 5.25% at their June meeting, according to the summary. "The participants favoring a 25 basis point increase noted that the labor market remained very tight, momentum in economic activity had been stronger than earlier anticipated," and that evidence was unclear about inflation returning to 2%, the report showed.
Although "almost all" policymakers said they expected more rate hikes this year, "many" noted that "a further moderation in the pace of policy firming was appropriate" to allow them to assess the consequences of their previous moves.
