A few Federal Reserve policy makers said the central bank will probably need to take more action to boost the labor market and meet its inflation target, according to minutes of their June meeting.
“A few members expressed the view that further policy stimulus likely would be necessary to promote satisfactory growth in employment and to ensure that the inflation rate would be at the Committee’s goal,” according to the record of the Federal Open Market Committee’s June 19-20 gathering released today in Washington.
Members agreed the risk of such a deterioration was “low at present” and would be outweighed by the benefits of extending the Operation Twist program.
Nearly all policy makers judged uncertainty about economic growth and unemployment to be higher than the normal level during the previous 20 years, the minutes show.
Central banks cut interest rates and boosted bond buying to prop up economic growth on July 5. The European Central Bank and People’s Bank of China cut their benchmark borrowing costs, while the Bank of England raised the size of its asset-purchase program. The steps by the U.K. and euro area pushed JPMorgan Chase & Co.’s average interest rate for developed economies to a crisis-era low of 0.48 percent.