WASHINGTON, July 10 (Xinhua) -- U.S. Federal Reserve officials saw a "strengthened" case for the central bank to lower interest rates in the near term when they gathered in June, according to the minutes of the Fed's latest monetary policy meeting.
"Nearly all participants had revised down their assessment of the appropriate path for the federal funds rate over the projection period," said the minutes of the Fed's June 18-19 policy meeting released on Wednesday, adding "many participants indicated that the case for somewhat more accommodative policy had strengthened."
Eight of 17 Fed officials expected the central bank to lower rates by the end of the year, while another eight saw no change and one projected a rate increase, according to updated quarterly forecasts of the federal funds rate released last month.
"Many judged additional monetary policy accommodation would be warranted in the near term should these recent developments prove to be sustained and continue to weigh on the economic outlook," the minutes said.
Several Fed officials noted that a near-term rate cut was "appropriate" from a risk-management perspective as it "could help cushion the effects of possible future adverse shocks to the economy."
"Some participants also noted that the continued shortfall in inflation risked a softening of inflation expectations that could slow the sustained return of inflation" to the central bank's 2 percent target, the minutes showed.
The minutes came after Fed Chairman Jerome Powell said earlier in the day that crosscurrents such as trade tensions and concerns about global growth have been weighing on the U.S. economic activity and outlook.
While testifying before the House Financial Services Committee, Powell reiterated that the Fed will act as appropriate to sustain the current economic expansion.
Powell's remarks bolstered market expectations that the Fed was preparing to cut interest rates as soon as its next policy meeting on July 30-31.
"Still expecting a cut in July," Diane Swonk, chief economist at Grant Thornton LLP, tweeted on Wednesday.
"The Fed sees trade tensions in the context management - they require an insurance cut hedge the fat tail risks of trade becoming a larger drag on growth," Swonk said.
Nearly 40 percent of economists expected the Fed to lower rates in July, while roughly 30 percent foresaw a rate cut in September, according to a survey released by the Wall Street Journal last month.
