At the policy meeting on December 13-14, Federal Reserve officials agreed that the U.S. central bank should slow down the pace of its interest rate hikes. This would allow the Fed to continue raising interest rates in an effort to rein in inflation, but to do so in a more gradual way that would reduce the likelihood of any negative impacts on economic growth.
The minutes from the meeting, which were released on Wednesday, revealed that policymakers were still concerned about the “misperception” in financial markets that their commitment to battling inflation was waning, and were working to slow price increases that were running hotter than expected.
But officials also acknowledged they had made “significant progress” in the past year by hiking rates enough to control inflation. Therefore, the central bank now had to strike a compromise between fighting growing prices and perhaps “placing the largest burdens on the most vulnerable groups” due to higher-than-necessary unemployment.
As the minutes from the Fed’s meeting were revealed on Wednesday, equities on Wall Street were able to snap a two-day losing streak overnight.
