US Federal Reserve officials discuss 'slightly steeper' future rate hikes

US Federal Reserve officials signalled that the central bank may have to accelerate the pace of future rate hikes amid stronger economic growth and inflation, according to the minutes of the Fed's latest monetary policy meeting.

"A number of participants indicated that the stronger outlook for economic activity, along with their increased confidence that inflation would return to two per cent over the medium term, implied that the appropriate path for the federal funds rate over the next few years would likely be slightly steeper than they had previously expected," said the minutes of the Fed's March 20-21 meeting released on Wednesday.

At that meeting, the Fed raised its target range for the federal funds rate to 1.5-1.75 per cent, the first rate hike of 2018, reports Xinhua.

It was also the first meeting led by Fed Chairman Jerome Powell, who took the helm of the central bank in February.

Fed officials' medium forecast for the benchmark interest rate last month signalled that there were two more rate hikes this year.

Fed officials also penciled three rate increases in 2019 and two in 2020, more than previously estimated in December.

While Fed officials were generally optimistic about growth prospects, they warned that trade tensions between the US and other trading partners could present "downside risks" to the US economy.

"A strong majority of participants viewed the prospect of retaliatory trade actions by other countries, as well as other issues and uncertainties associated with trade policies, as downside risks for the US economy," the minutes said.

The Fed will hold its next policy meeting on May 1-2. Many market analysts suspect that the central bank might ultimately have to push for four rate increases this year, with the next move in June.