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The minutes of the U.S. Federal Reserve meeting revealed that the bank's concerns about persistent inflation widened in July. Some members expressed the view that monetary policy tightening might be necessary if the pace of price increases does not decline to the 2% target. The minutes showed that several members supported a 25 basis point rate hike due to inflation pressures and the need for a more stringent policy to achieve price stability and maintain employment. Although the Federal Open Market Committee kept the interest rate range between 3.5% and 3.75%, some members favored raising it by a quarter of a percentage point, warning that failing to tighten appropriately could lead to more severe and costly measures later on. Inflation expectations ranged from a gradual decline to remaining high, with recent increases linked to tariffs, energy costs, and expanded spending on artificial intelligence. It is expected to ease for the rest of the year, but there remains a possibility of continued elevated inflation if supply chain disruptions persist or new shocks occur.
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