Fed expects rate hikes, minutes from January meeting show

Feb. 21 (UPI) -- Federal Reserve officials pointed to a "substantial underlying economic momentum" as an indicator for a gradual future rate hike, minutes from their January meeting released Wednesday revealed.

The Federal Open Market Committee chose not to raise its benchmark interest rate Jan. 31, keeping the rate between 1.25 percent and 1.5 percent.

But the rate likely won't remain steady at future meetings.

"A majority of participants noted that a stronger outlook for economic growth raised the likelihood that further gradual policy firming would be appropriate," a summary of the meeting's minutes said.

Some members upgraded their expectations of economic growth for the near term compared to expectations at the December meeting. The Fed expects inflation to grow to 2 percent and stabilize "over the medium term."

They "anticipated that the rate of economic growth in 2018 would exceed their estimates of its sustainable longer-run pace and that labor market conditions would strengthen further," the minutes said.

January's meeting was the last presided over by Chair Janet Yellen, who left the Fed in early February at the expiration of her term. Jerome Powell will preside over the next meeting in March.