June FOMC minutes reveal most officials open to further rate hikes if supply shocks lift inflation, despite stable labor data.
Federal Reserve officials expressed growing concern over inflation risks tied to supply-side factors in June meeting minutes. While a few participants favored a rate hike, most backed holding rates but signaled willingness to tighten policy further if oil prices, tariffs, or supply chain disruptions push inflation higher.
The minutes highlighted stability in the U.S. labor market but noted risks from artificial intelligence, trade barriers, and energy costs. Most participants indicated they would support rate hikes even if labor markets remain steady, prioritizing inflation control over employment trends.
Markets parsed the hawkish tone, with attention on potential triggers like a Strait of Hormuz closure. The Fed also shortened its statement format, though no updates on internal task forces were provided.