(Reuters) – The boards of directors of the Atlanta and Dallas Federal Reserve Banks voted in mid-January to keep unchanged the rate charged to commercial banks for emergency loans, minutes of their discount rate meetings showed on Tuesday.
Meanwhile directors on the boards of the Cleveland, St. Louis and Minneapolis Fed banks voted for a half-point increase in that rate, the minutes showed.
The requests from all five banks were overruled when Fed policymakers at their Jan. 31-Feb. 1 meeting decided to raise the benchmark policy rate by a quarter of a percentage point, to a 4.5%-4.75% range. That was in line with votes from the seven remaining Fed bank boards of directors.
The split among Fed banks over the appropriate setting for the discount rate, which is separate from but moves in step with the rate set by the Fed’s policymaking panel, suggests some disagreement over how much further rates ought to rise to bring down too-high inflation.
“Directors were generally cautious or concerned about a weaker outlook for the economy, and some directors expected the inflation rate, which remained elevated, to slowly moderate in 2023,” the minutes said.
Fed presidents say the views of their directors help shape their outlooks, even if they don’t set the actually policy rate.
(Reporting by Ann Saphir; Editing by Andrea Ricci)
