The minutes from the latest Fed policy meeting kept the door open to a rate hike in September. Bobbi Rebell reports.
The job market is getting better, and that is pushing the Fed closer to a rate hike. The revelation coming from the minutes from the U.S. central bank's policy meeting in July. While the minutes did not make an overt reference to a possible September rate hike, Wells Fargo Chief Economist John Silvia says, he believes that's the plan. SOUNDBITE: JOHN SILVIA, CHIEF ECONOMIST, WELLS FARGO (ENGLISH) SAYING: "The big issue for them was some improvement in the labor market, and we are, certainly, getting that from the minutes that were expressed. The economy continues to improve. I think, there was a lot of focus that, you know, China makes a little bit of a difference. There is a risk there, according to the Federal Open Market Committee, but it doesn't seem to be so significant as to impact the U.S. economic outlook." But there was still widespread concern about weak inflation. The Fed has said it wants to be 'reasonably confident' in the inflation outlook before a rate hike. The committee also noted that wages were not showing any signs of a meaningful increase. Yields on long-term U.S. government bonds fell sharply, and the dollar weakened after the release of the minutes. That suggests investors saw them as an sign the Fed would be cautious about hiking rates.