The U.S. Federal Reserve remains committed to increasing interest rates in a bid to control the highest inflation in roughly 40 years, but agreed to slow the pace “at some point,” according to minutes from the session released Wednesday.
While approving to raise interest rates by 0.75 percentage points during the meeting, central bank officials reaffirmed their commitment to bring down “unacceptably high” inflation, which is currently hovering above the Federal Reserve’s target of 2%.
The Fed has raised the benchmark interest rate four times this year, including two massive 0.75 percentage point increases in June and July, an urgent move after US annual inflation spiked to 9.1% in June.
At the beginning of the coronavirus pandemic, the rate was reduced to zero; presently, it is between 2.25 – 2.5%.
However, the policymakers at Fed did not provide specific direction for future hikes, but did state that they would thoroughly monitor data before making a decision. Markets anticipated a half-point rate hike at the September meeting.
