Federal Reserve officials held diverging views last month on the appropriate path of interest rates, minutes from the central bank's June policy meeting showed Wednesday.
The Federal Open Market Committee unanimously decided to maintain its policy rate between 3.50% and 3.75% for the fourth consecutive time at the June 16-17 meeting. At the time, it removed the so-called easing bias from its policy statement.
Meeting participants analyzed various scenarios, including one where easing inflation would justify keeping rates on hold or eventually cutting them, according to the meeting minutes.
Participants also assessed a situation in which inflation would remain elevated due to strong artificial intelligence-related demand, the Middle East conflict and tariffs, thus supporting some policy tightening, the minutes showed.
Picking their most likely scenario for the economy, "many participants indicated that the appropriate level of the federal funds rate would be within or slightly below the current target range at the end of this year," the document said.
Still, several other participants saw the federal funds rate above the current target range for this year.
There's a nearly 70% likelihood that the FOMC will keep monetary its policy unchanged later this month, while the odds of a 25-basis-point rate increase moved to 30% on Wednesday from 27% on Tuesday, according to the CME FedWatch tool.
The Fed's preferred inflation metric -- the personal consumption expenditures price index excluding food and energy -- accelerated to the fastest reading in more than two years in May, government data showed late last month.
Last week, Fed Chair Kevin Warsh said inflation risks had eased, while reaffirming the central bank's commitment to deliver price stability.
Following a pullback recently, crude oil prices jumped Wednesday as President Donald Trump threatened additional attacks on Iran, saying that the ceasefire agreement Washington signed with Tehran last month was "over."
On the labor front, nonfarm payrolls data showed last week that the US economy added fewer jobs than expected in June while gains for the prior two months were downgraded.
"Participants noted that their future policy actions would depend on incoming information," the Fed meeting minutes showed.
