The Fed minutes reveal concerns about “the effects of higher prices” because the central bank’s left rates are unchanged

According to the report of the meeting from the meeting from July 29 to 30, published on Wednesday, the members of the Fed interest rate adjustment committee “assessed that the effects of higher prices had become more obvious in the prices of certain goods, but that their global effects on economic activity and inflation have remained to be seen.”

The minutes stressed the reluctance among the majority of the 19 Fed decision-makers to reduce the short-term interest rate of the Central Bank until they have a clearer idea of the impact of the radical tariffs of President Donald Trump on inflation. So far, inflation has slipped in the past two months, but has not increased as much as many economists feared when Trump has unveiled some of his functions.

The Fed left its key interest rate unchanged last month at around 4.3%, although two members of its board of directors are dissident in favor of a rate drop. The two dissidents – Christopher Waller and Michelle Bowman – were appointed to the board of directors during Trump’s first term.

At a press conference after the meeting, President Jerome Powell said he could take an important time for the Fed to determine if Trump’s radical rates stimulate inflation.

When the Fed changes its rate, it often affects – but not always – borrowing costs for mortgages, car loans and credit cards.

The Fed generally maintains its high rate or lifts it to cool borrowing and expenses and fighting inflation. It often reduces its rate to strengthen the economy and hires when growth cools.