Increase Of Downside Risks Led Fed To Hold Off Rate Hike In September

Federal Reserve officials held off of a rate hike in September as many thought downside risks had increased, according to minutes of the meeting released Thursday. Officials decided it would be "prudent" to wait, even though many thought that the weaker growth outlook for China that emerged in August and the subsequent drop in stock prices around the world would "likely" have a small effect on the economy. Some voting members of the Fed policy committee said that these global developments did not increase their confidence that inflation would return to the central bank's 2% target. Fed officials were split, with some worried that hiking rates too soon would push inflation lower and others saying that delaying a hike for much longer would risk an undesirable buildup of inflation. In the end, the Fed voted 9 to 1 to hold rates steady.