Fed minutes show officials linking rate increase to economic data

Associated Press

WASHINGTON

Federal Reserve officials, worried about weak growth overseas, agreed last month that they would begin raising interest rates only when measures of the economy’s health and inflation signaled the time was right.

Minutes of the Fed’s discussions at the Sept. 16-17 meeting released Wednesday showed that officials expressed rising worries about lackluster growth in Europe, as well as slowing growth in Japan and China.

The U.S. stock market surged after the release of the minutes, logging its biggest gain of the year. Investors appeared to take the revealed discussion as a sign that the Fed was in no hurry to raise interest rates.

“The markets like the news that there is no urgency on the part of Fed officials to stop doing what they are doing,” said Chris Rupkey, chief financial economist at MUFG Union Bank in New York.