US rate-setters clashed at their meeting this month over whether or not to prioritise fighting inflation over a cooling labour market, minutes of one of the most divided monetary policy votes in recent decades highlighted.
While many Federal Reserve policymakers said the latest data indicated President Donald Trump’s trade war would not trigger persistent price pressures, several rate-setters “pointed to the risk of higher inflation becoming entrenched”, the minutes of the December 9-10 meeting, published on Tuesday, said.
Several rate-setters voiced concerns that cutting interest rates could be “misinterpreted” as signalling the central bank was no longer committed to keeping price pressures under control, the minutes added.