Both trends, if they continued, could lead the Fed to cut its benchmark interest rate in the coming months from its 23-year peak of 5.3%. The minutes of the Fed’s June 11-12 meeting, released Wednesday, showed that the policymakers saw several factors that could further ease inflation in the coming months. These factors included the slower growth of wages, which reduces pressure on companies to raise prices to cover their labor costs.
That is a shift from the previous two years, when the Fed was focused solely on curbing inflation, which reached a four-decade high in 2022 of 9.1%. 'The vast majority of participants assessed that growth in economic activity appeared to be gradually cooling, and most participants remarked that they viewed” the central bank’s benchmark rate as high enough to slow growth and inflation.