Federal Reserve may need to accelerate interest rate hikes after Trump win
Some rate-setters think Mr Trump's planned tax cuts and spending hikes might mean action is needed to keep a lid on price rises.
Wednesday 4 January 2017 21:35, UK
US officials have said they might have to increase the pace of interest rate hikes if Donald Trump's stimulus programme threatens to pump up inflation.
Minutes of the US Federal Reserve meeting last month did not mention the President-elect by name but showed that they were considering the impact of his economic plans.
The path of interest rates in the world's biggest economy has serious repercussions around the world especially in developing countries most vulnerable to increases in dollar borrowing costs.
Last month's Fed meeting saw the central bank hike rates by 0.25% - only the second time they have been increased since they were cut to near-zero during the financial crisis in 2008.
Minutes revealed that officials discussed the impact of Mr Trump's plans for tax cuts, deregulation and increased infrastructure spending - which have boosted markets and lifted the US dollar.
Rate-setters believed they could maintain plans for gradual rate hikes but would need to be ready to accelerate the increases if necessary to try to keep a lid on inflation.
Most felt that "upside risks" to economic forecasts had increased "as a result of prospects for more expansionary fiscal policies in coming years".
The minutes showed many officials saw that the risk of unemployment falling more quickly than expected had increased - a development that could put upward pressure on prices.
"The committee might need to raise the federal funds rate more quickly than currently anticipated to limit the degree of undershooting and stem a potential build-up of inflationary pressure," the minutes said.
Last month's meeting saw the Fed forecast that it could increase rates three times in 2017.
Chair Janet Yellen said the US central bank was "operating under a cloud of uncertainty".
The election of Mr Trump - who had criticised Ms Yellen during his campaign - has cast doubt on her position.