Fed Officials Divided on Interest Rate Outlook, FOMC Minutes Show

Federal Reserve officials held diverging views last month on the appropriate path of interest rates, minutes from the central bank's June policy meeting showed Wednesday. The Federal Open Market Committee unanimously decided to maintain its policy rate between 3.50% and 3.75% for the fourth consecutive time at the June 16-17 meeting. At the time, it removed the so-called easing bias from its policy statement. Meeting participants analyzed various scenarios, including one where easing inflation would justify keeping rates on hold or eventually cutting them, according to the meeting minutes. Participants also assessed a situation in which inflation would remain elevated due to strong artificial intelligence-related demand, the Middle East conflict and tariffs, thus supporting some policy tightening, the minutes showed. Picking their most likely scenario for the economy, "many participants indicated that the appropriate level of the federal funds rate would be within or slightly below the current target range at the end of this year," the document said. Still, several other participants saw the federal funds rate above the current target range for this year. There's a nearly.