Fed minutes show all 19 officials backed September rate hike

All 19 Federal Reserve officials backed September’s quarter-point interest-rate increase, a show of support that reached beyond the policymakers with votes and reflected concern that inflation pressures were intensifying, according to Bloomberg’s account of the meeting minutes.

The decision raised the benchmark federal funds rate to a range of 3.75% to 4%, Bloomberg reported. Most participants judged that another increase would probably be appropriate by year-end, according to FXStreet’s reporting on the minutes.

Officials generally viewed the labor market as close to full employment and job-market risks as broadly balanced, while almost all saw inflation risks tilted upward, FXStreet reported. The Fed staff’s economic outlook was stronger than in July, and officials judged financial conditions still supportive of growth despite higher long-term Treasury yields.

AI investment also figured in the inflation discussion. Several officials warned that the buildout could eventually push demand ahead of supply and add upward pressure on prices, according to the same account. Their concern was a possible consequence of continued investment, not simply current price readings.

Support for September’s move did not settle the timing of another increase. The minutes suggested little urgency for an October hike, according to Yahoo Finance. Economic releases after the meeting complicated the picture: inflation held steady in August, while September payroll data raised doubts about labor-market strength, FXStreet reported. Those releases tempered expectations for back-to-back increases even as most officials had favored another hike before year-end.