Fed Officials See Interest Rate Hike as ‘Necessary’ If Inflation Doesn’t Ease Soon

Federal Reserve policymakers see an interest rate hike as likely if inflation does not ease in the coming months, according to newly released meeting minutes.Minutes from the Federal Open Market Committee meeting held in Washington, DC, on July 28 and 29 suggest that there is growing acceptance on the panel that an increase to overnight interest rates may become necessary."Many participants assessed that policy tightening would likely be necessary if inflation did not decline," the minutes state. "Some participants commented that financial conditions might not currently be sufficiently restrictive to facilitate a return of inflation to 2%."At the meeting, the majority of the 12-member panel voted to leave rates unchanged at a top range of 3.75%, where they have remained since January. But Fed Chairman Kevin Warsh, who called for lower rates before taking office in May, faces a rising chorus of rate hike calls from more hawkish colleagues.Chief among them was Cleveland Fed President Beth Hammack, who, along with Dallas Fed President Lorie Logan and Minneapolis Fed President Neel Kashkari, voted to raise rates at last month's meeting."A few of the participants who favored raising the...