Crypto: Fed Minutes Suggest Rate Hikes On Table Again Amid Inflation Jitters

Fed policymakers said easing may not be warranted until there is a clear indication that the progress of disinflation is firmly back on track.

United States Federal Reserve policymakers discussed the possibility of interest rate increases last month, according to newly released comments from a January meeting.

The minutes of the Federal Open Market Committee meeting from late January were released on Wednesday, revealing that some policymakers were mulling a rate hike due to stubbornly high inflation.

Several participants indicated that they would support “the possibility that upward adjustments to the target range for the federal funds rate could be appropriate if inflation remains at above-target levels,” the minutes stated.

Central bank policymakers voted to keep interest rates unchanged at 3.5% to 3.75% at their January meeting after cutting rates three times at the end of 2025, from 4.5% to current levels.

If enacted, it would be the first rate hike since July 2023. However, CME futures markets indicate a 94% probability that rates will remain unchanged at the Fed’s next meeting on March 18.

The Federal Reserve has two primary mandates for its policy on rates: inflation and the labor market.

The minutes also revealed a significant “hawkish” contingent that is not yet ready to commit to further cuts.

Some participants commented that it would likely be appropriate to “hold the policy rate steady for some time” to give them more time to assess economic data.

However, a number of these participants judged that “additional policy easing may not be warranted until there was a clear indication that the progress of disinflation was firmly back on track.”

Source: CoinTelegraph