WASHINGTON (AP) – Federal Reserve officials at their September meeting struggled to come to terms with persistently low inflation. But in the end, they decided that they should continue to signal the possibility of a third rate hike this year.
The minutes of their discussions show that a group of Fed officials worried that low unemployment could result in a quick rebound in inflation and that a third rate hike was needed. Another group believed that no further increases were called for in the near term.
Many private economists believe the Fed will hold rates steady for the rest of the year if inflation readings fail to show progress in reaching the central bank’s 2 percent inflation target. The Fed has its next meeting Oct. 31-Nov. 1 before a final meeting in mid-December.