Members of the Federal Open Market Committee “generally agreed” that the case for raising the federal funds rate strengthened in recent months, according to minutes released Wednesday of their two-day September meeting. For members who wanted further economic evidence, it “was a close call” whether to raise rates or to wait.
A more divided committee decided to keep the current 0.25% to 0.5% target range, with three members preferring to increase the range to 0.5% to 0.75% at the September meeting and three others not wanting to raise rates at all this year.
“It was noted that a reasonable argument could be made either for an increase at this meeting or for waiting for some additional information on the labor market and inflation,” the minutes said, with some members noting that it is easier to raise them than reduce them if needed later. “Some participants believed that it would be appropriate to raise the target range for the federal funds rate relatively soon if the labor market continued to improve and economic activity strengthened, while some others preferred to wait for more convincing evidence that inflation was moving toward the committee’s 2% objective,” the minutes said.
FOMC members meet in November and December, and a rate rise could come “relatively soon,” the minutes said.