Fed Policymakers' Inflation Concerns Mount as Rate Hikes Loom

US Federal Reserve policymakers are increasingly concerned about inflation, according to minutes from their July meeting. Several participants favored raising interest rates and many said a hike would be necessary if inflation doesn't decline to the Fed's 2% target.

The Fed voted to keep its benchmark rate at 3.5-3.75%, but three policymakers dissented in favor of a quarter-point increase. A larger group assessed that policy tightening would likely be needed if inflation does not decline.

Fed Chairman Kevin Warsh has been exploring changes to the Fed's operations, including reducing the number of meetings per year from eight to six. However, no decisions have been made on this proposal.