The US Federal Reserve has acknowledged the need to continue raising interest rates to contain inflation.
According to the minutes of the Federal Open Market Committee’s regular meeting in June, released by the Federal Reserve on June 6 local time, meeting attendees all agreed that it was reasonable to maintain a restrictive policy based on the economic outlook.
At the Federal Open Market Committee’s regular meeting held on the 14th and 15th of last month, the Fed announced a 0.75 percentage point or 0.50 percentage point hike in July, the first-rate hike in 28 years, the ‘giant step’.
Therefore, the minutes of the minutes emphasizing the need for a ‘constrained policy’ are interpreted as implying that a large base rate hike may continue in the future.
Federal Open Market Committee members showed their willingness to prioritize ‘catch up on prices’ even if a steep rate hike could lead to a slowdown in the US economy.
“While meeting attendees acknowledged that tightening monetary policy could slow economic growth for the time being, they also saw inflation lowering to 2% again as critical to achieving maximum employment,” the minutes said.