Federal Reserve officials were concerned at their meeting last month that consumers were increasingly anticipating higher inflation, and they signaled that much higher interest rates could be needed to restrain it.
send the economy into a recession late this year or next year
Some economists described the Fed's assessment of the economy, as laid out in Wednesday's minutes, as outdated even though it is only three weeks old. Prices for oil, wheat and other commodities are falling, wage gains are moderating and growth is slowing. Those trends may mean that the Fed's policymakers, who have said they will be “nimble” in responding to economic data, won't raise rates as fast as financial markets expect.
Powell also cited a survey of consumer sentiment conducted by the University of Michigan that said consumers’ longer-term inflation expectations were starting to rise more quickly. That unnerved Powell and other Fed officials, because if people expect higher inflation, that sentiment can lead to an acceleration of prices.
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