Fed minutes may shape debate over rate hikes

The Fed minutes may shape the debate over what follows June, July rate hikes WASHINGTON Reuters - The Federal Reserve'sFederal Reserve's May 3 -- 4 policy meeting ended with a half-point rate increase and Chair Jerome Powell said that similar increases would be approved when policymakers gathered in June and July to curb inflation that is far above the U.S. central bank's 2% target.

Minutes of the May session, due to be released on Wednesday at 2 p.m. EDT 1800 GMT, could influence the debate over what happens next.

The planned June and July rate hikes have been supported by policy spectrum officials, aligning their support for Powell's push to make inflation the Fed's top priority.

There has been a wide range of positions, from an outright pause in rate increases this fall to calls for a string of half-percentage increases at the September, November and December meetings.

There are minutes on Wednesday that mention the appetite for larger incremental rate increases of three-quarters of a percentage point.

Analysts at Citibank said they would be looking for a discussion of growth versus inflation concerns as Fed officials try to get the economy out of its current inflation dilemma without a recession or pushing the unemployment rate higher.

Inflation data has yet to show a convincing turn lower from levels that have unnerved Fed officials and drawn comparisons with the inflation shocks of the 1970 s and early 1980 s. The Fed preferred measure of inflation is at more than three times the central bank's target.

Some analysts have raised their risks of the recession, and investors in contracts linked to the federal funds rate have recently pared back their estimates of how high interest rates will rise.