Fed saw evidence of a slowing economy at its last meeting

Federal Reserve officials saw signs that the U.S. economy was slowing at their last meeting, when the central bank hiked interest rates by a sizable three-quarters of a percentage point. Despite the slowdown, inflation remained "unacceptably high," officials said, leading to the fourth interest rate hike this year. 

In minutes from their July 26-27 meeting released Wednesday, members of the Fed's rate-setting body said they expected the economy to expand in the second half of 2022. But many of them suggested that growth would weaken as higher rates take hold. The housing market, consumer spending, business investment and factory production have all decelerated after expanding robustly in 2021, officials noted.

Slower growth, they said, could "set the stage" for inflation to gradually fall to the central bank's 2% annual goal, though it remained "far above" that target. But the policymakers made clear that — for now — they intend to continue raising rates enough to slow the economy.