Minutes of the U.S. Federal Reserve meeting released on the 22nd showed that Fed officials were concerned about the lack of progress in U.S. inflation and that the federal funds rate needs to be maintained at the current level for longer to achieve the inflation target.
The minutes of the Federal Reserve's May monetary policy meeting released that day showed that participating officials noted that the components of U.S. goods and service prices have increased significantly recently, and that the Federal Reserve has "lack of further progress" in achieving its long-term inflation target of 2%. .Federal Reserve officials believe that the current level of federal funds interest rates is sufficient to curb U.S. economic activity and reduce inflation.
In the future, inflation is expected to return to the long-term target level of 2%, suggesting that the Federal Reserve will continue to maintain interest rates unchanged.But officials are uncertain about how long it will take to reach the target and the impact of keeping interest rates high on achieving it.An unspecified number of officials mentioned that if inflation conditions indicate that further tightening of monetary policy "is appropriate," then they would be willing to do so.The minutes of the meeting showed that the future trend of U.S. inflation faces several upward risks, especially geopolitical factors that may cause prices to continue to rise, putting pressure on consumers, especially low-income groups.
Officials at the meeting worried that as inflationary pressures persist, consumers will turn to riskier forms of financing to stay afloat.Many participants pointed to signs that the financial well-being of low- and middle-income American families is increasingly under stress.These officials see this as a downside risk to the outlook for consumption.The minutes of the meeting also showed that Fed officials were generally optimistic about the prospects for U.S. economic growth, but expected economic growth to slow this year.
The Federal Reserve held a monetary policy meeting from April 30 to May 1, and maintained the target range of the federal funds rate at 5.25% to 5.5% for the sixth consecutive meeting.Federal Reserve Chairman Powell said at the press conference after the meeting that demand in the U.S. labor market remains strong and inflation is growing faster than expected.In this case, "postponing a rate cut may be appropriate."
