Fed Requires 'Flexibility' in Rates as Inflation Remains Main Focus

Fed minutes, released on Wednesday, showed that Chairman Jerome Powell and policymakers remain focused on controlling the pace of rate increases that threaten to turn out to be hotter than expected, and are wary of any "misperception" in financial markets that their commitment to fighting inflation was on its way, and by no means weak.

Officials acknowledged that they had made "significant progress" over the past year in raising interest rates enough to bring down inflation.

“Most participants emphasized the need to retain flexibility and discretion when moving policy to a more restrictive position,” the minutes said, noting that officials may be willing to scale back quarter-percentage-point increases from January-February 31 meeting, but also remained open to a higher-than-expected "final" rate if high inflation persists," New York Post said.

"The minutes put a premium on making clear that the decision to move to smaller interest rate increases should not be interpreted by investors or the public at large as a weakening of its commitment to return inflation to the central bank's 2% target," it added.