“It was observed that if foreign economic or financial conditions deteriorated further, U.S. economic growth over the medium term might be slower than currently expected,” the minutes show.
Still, many participants said the effects of weaker growth abroad are “likely to be quite limited,” with officials noting the share of external trade in the U.S. economy is “relatively small,” effects of dollar fluctuations are “modest,” or that the slowdown in foreign demand “would likely prove to be less severe than initially feared.”
The minutes showed a wide-ranging debate over whether to retain the committee’s pledge to keep interest rates near zero for a “considerable time.” The panel ultimately adopted the suggestion from some participants to add wording emphasizing the timing on rate increases would depend on incoming economic data.
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