Federal Open Market Committee members showed a somewhat optimistic note about the economy but continue to be reluctant about raising the federal funds rate, said minutes released Wednesday from the June meeting.
“Most participants judged that the conditions for policy firming had not yet been achieved; a number of them cautioned against a premature decision,” the minutes said. Many participants cited the need for more indicators of economic growth and improving labor market conditions.
On Tuesday, executive directors of the International Monetary Fund warned that interest rate increases “should remain data-dependent” and cautious. IMF officials “saw merit in awaiting clear signs of wage and price inflation and sufficiently strong economic growth (first),” according to an IMF statement.
IMF staffers reporting to the directors said the FOMC “should defer its first increase in policy rates until there are greater signs. … This would imply a gradual path of policy rate increases starting in the first half of 2016,” the IMF staff report said.
