July 20th, 2024

Federal Reserve minutes: Inflation is cooling, but more evidence is needed for rate cuts

By Christopher Rugaber, The Associated Press on July 3, 2024.

FILE - A news conference with Federal Reserve Chair Jerome Powell appears on a monitor on the floor at the New York Stock Exchange in New York, May 1, 2024. The Federal Reserve delivers the minutes from its most recent interest rate policy meeting on Wednesday, July 3, 2024. (AP Photo/Seth Wenig, File)

WASHINGTON (AP) – Federal Reserve officials at their most recent meeting welcomed recent signs that inflation is slowing and highlighted data suggesting that the job market and the broader economy could be cooling.

Both trends, if they continued, could lead the Fed to cut its benchmark interest rate in the coming months from its 23-year peak.

The minutes of the Fed’s June 11-12 meeting, released Wednesday, showed that the policymakers saw several factors that could further ease inflation in the coming months. These factors included the slower growth of wages, which reduces pressure on companies to raise prices to cover their labor costs.

The policymakers also pointed to anecdotal cases of retail chains and other businesses lowering prices and offering discounts, a sign that customers are increasingly resisting higher prices.

And in a noticeable shift from previous minutes, the officials cited concerns that a further cooling in the job market would likely lead to layoffs. So far, slowing demand for workers has mostly appeared in the form of fewer job postings.

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