WASHINGTON (dpa-AFX) - The Federal Reserve released the minutes of its latest monetary policy meeting on Wednesday, revealing officials are still not prepared to begin cutting interest rates.
The minutes of the June 11-12 meeting said participants noted that progress in reducing inflation toward the Fed's 2 percent target had been slower this year than they had expected last December.
'They emphasized that they did not expect that it would be 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 Committee's 2 percent objective,' the Fed said.
Participants also emphasized the importance of conditioning future policy decisions on incoming data, the evolving economic outlook, and the balance of risks.
During the meeting, the Fed once again decided to maintain the target range for the federal funds rate at 5.25 to 5.50 percent, as was widely expected.
Fed officials also provided their latest economic projections at the meeting, with the forecasts suggesting just one interest rate cut this year compared to the three predicted in March.
However, the accompanying dot plot suggested there is some division among Fed officials about the outlook for rates this year.
The division was also reflected in the minutes of the meeting, which said most participants view the current policy stance as restrictive but some noted there was uncertainty about the degree of restrictiveness of current policy.
'Some remarked that the continued strength of the economy, as well as other factors, could mean that the longer-run equilibrium interest rate was higher than previously assessed, in which case both the stance of monetary policy and overall financial conditions may be less restrictive than they might appear,' the Fed said.
The central bank added, 'A couple of participants noted that the longer-run equilibrium interest rate was a better guide for determining where the federal funds rate may need to move over the longer run than for assessing the restrictiveness of current policy.'
Some participants emphasized the need for patience in allowing the restrictive policy stance to restrain aggregate demand and further moderate inflation pressures, the minutes said.
Several participants also observed that rates might need to be raised if inflation were to persist at an elevated level or to increase further, the Fed said, while a number of participants remarked that monetary policy should stand ready to respond to unexpected economic weakness.
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