Fed officials signal rates may head to 'restrictive' levels

Chair Jerome Powell himself had indicated after this month’s meeting that half-point increases would be “on the table” at the next two meetings.All the officials believed that the Fed should “expeditiously” raise its key rate to a level at which it neither stimulates nor restrains growth, which officials have said is a rate of about 2.4%. And Loretta Mester, president of the Federal Reserve Bank of Cleveland, has said that if there’s “compelling evidence that inflation is moving down,” the Fed could slow its rate hikes, likely to a quarter-point pace.“But if inflation has failed to moderate,” she added, “a faster pace of rate increases may be necessary.”The minutes released Wednesday signaled a tentative acknowledgement by some Fed officials that recent inflation data “might suggest that overall price pressures may no longer be worsening.” At the same time, those officials — the minutes don’t name individual Fed policymakers — stressed that it was “too early to be confident that inflation had peaked.”Fed officials unanimously agreed that the “U.S. economy was very strong, the labor market was extremely tight, and inflation was very high and well above” the Fed’s target of 2%.