At the meeting, held late last month, Fed officials said the slow economic start to the year was mostly caused by the cold winter and other transitory factors, and predicted a rebound. However, the agency is currently holding interest rates near zero until it’s satisfied that the economy is moving along again. The meeting minutes, released after the usual three-week delay, said most officials “thought it unlikely that the data available by June would provide sufficient confirmation” that economic growth was strong enough to raise rates.
But the minutes also suggested that Fed officials are ready to raise rates as soon as that evidence has accumulated, according to a New York Times report. Most analysts expect the Fed to start hiking rates in September.
“What is not surprising is that most ruled out a rate hike in June; what is more surprising is that most would not rule it out,” Eric Green, head of economic research at TD Securities, wrote in a message to clients after the minutes were published. “It affirms the point that the threshold to raise rates is very low and the bias to do so very high.”
Brokers may want to start pushing refis while rates remain low. An account of the Federal Reserve’s recent policy meeting indicates that while the Fed probably won’t raise the benchmark interest rate in June, it won’t wait much longer.