A June pause in rate hikes would be a close call for Fed officials, minutes of last meeting show

May 24, 2023  -WASHINGTON (AP) — Federal Reserve officials were divided earlier this month on whether to pause their interest rate hikes at their upcoming meeting in June, according to the minutes of their May 2-3 meeting released Wednesday.

“Several (policymakers) noted if the economy evolved along the lines of their current outlooks, then further policy firming after this meeting may not be necessary” — Fed parlance for a pause — the minutes said.

At the same time, “some” officials said that the persistence of high inflation meant that “additional (rate hikes) would likely be warranted at future meetings.”

Yet in the language used in the minutes, “several” is considered to be more than “some,” suggesting that those favoring a pause may have the upper hand.

In addition, Chair Jerome Powell and the officials closest to him have signaled in speeches over the past week that they’re likely to support a pause in rate hikes at their next meeting in mid-June.