Fed signals 'faster' interest rate hikes likely as inflation soars to 40-year high
The Fed is expected to begin raising interest rates in March
By Megan Henney FOXBusiness
Most Federal Reserve officials agreed last month that surging inflation and an incredibly tight labor market could warrant a faster-than-expected pace of interest rate hikes this year as policymakers look to combat soaring prices.
Minutes from the U.S. central bank's Jan. 25-26 meeting show that many policymakers believe the current economic conditions could necessitate a quicker normalization of policy than in 2015, though they stressed that this outlook ultimately hinged on financial developments. The Fed kept rates ultra-low for years following the 2008 financial crisis, only raising them once at the end of 2015. Officials subsequently raised rates eight more times over a three-year period.
"Compared with conditions in 2015 when the Committee last began a process of removing monetary policy accommodation, participants viewed that there was a much stronger outlook for growth in economic activity, substantially higher inflation, and a notably tighter labor market," the minutes said. "Consequently, most participants suggested that a faster pace of increases in the target range for the federal funds rate than in the post-2015 period would likely be warranted, should the economy evolve generally in line with the Committee's expectation."
more
https://www.foxbusiness.com/economy/federal-reserve-january-meeting-minutes
