Minutes from the April FOMC meeting reveal most policymakers expect a slower return to 2% inflation and may raise rates further if needed.
Federal Reserve officials indicated inflation remains above the 2% target, with risks from energy prices, geopolitical tensions, and AI-driven costs prolonging the path to stability. Most participants now expect inflation to take longer to ease than previously anticipated.
The minutes showed policymakers left the door open for additional rate hikes if inflation persists, though cuts could follow if price pressures ease or labor markets weaken significantly. Prior projections had signaled a more rapid disinflation trajectory, but recent data has tempered those expectations.
Markets reacted cautiously, with Treasury yields edging higher as investors recalibrated expectations for Fed policy timing.