US Fed officials call for interest rate hikes to continue until inflation slows

US Federal Reserve headquarters

US Federal Reserve officials at their July meeting agreed on the need to continue raising interest rates until the inflation came down substantially, according to minutes from the session released on Aug. 17.

The members of the Open Market Committee believe that that moving to a restrictive stance of policy was required – this implies levels high enough to slow economic growth.

The Fed hiked its benchmark interest rate by 75 basis points for a second straight month, in an effort to rein in inflation, which reached its highest level in 41 years in June, before slowing in July.

The minutes indicated that some Fed officials see the current interest rate remaining below the neutral level in the short term.

While some Fed officials expressed concern about the risks of the central bank tightening monetary policy more than necessary.

Investors are now waiting for the Fed's next meeting, to be held at the end of September, amid expectations that the interest rate will be raised by 50 or 75 basis points.