Fed Officials Weigh Higher Rates as Inflation Concerns Mount

Many Federal Reserve officials believe that interest rates will need to be increased if inflation persists above target levels, according to minutes from the Fed's July meeting.

The minutes of the July 28-29 meeting showed that while some officials thought rates could remain steady, others were concerned about the threat of high inflation.

Officials voted 9-3 at the meeting to keep their key rate unchanged at around 3.6%, but there is growing concern that rates may need to be raised in the coming months if inflation doesn't subside.

The Fed pays more attention to a separate gauge, the personal consumption expenditures (PCE) price index, which shows core PCE prices rose 3.3% in July from a year ago, compared with an annual core inflation of 2.5% in CPI.