U.S. Federal Reserve officials downgraded their economic forecast at their last policy-setting meeting, according to meeting minutes released today.
According to the minutes of the August 5 Federal Open Market Committee meeting, most officials said economic activity “was likely to remain damped for several quarters.”
FOMC officials appeared divided on the outlook for inflation. “Some viewed the upside risks to inflation as having diminished modestly over the intermeeting period, mainly as a result of the drop in the prices of oil and some other commodities as well as the greater likelihood of persistent economic slack. However, others viewed these risks as having increased,” the minutes said.
At it’s August 5 meeting, the FOMC voted 10-1 to keep the target federal funds rate at 2% for a second-straight meeting.