Two regional Fed banks urged holding discount rate steady before last meeting: minutes

WASHINGTON (Reuters) – Two regional Federal Reserve banks were pushing for holding steady the rate commercial banks are charged for emergency loans until shortly before the U.S. central bank’s last policy meeting, minutes from discussions about the discount rate showed on Tuesday.

The Fed raised its benchmark federal funds rate at its Sept. 26 policy meeting as it forecast that the U.S. economy would enjoy at least three more years of growth. The minutes of that meeting, released last week, showed that every policymaker favored raising rates.

But on Sept. 13, the directors of the Federal Reserve’s banks of New York and Minneapolis voted to hold the discount rate steady, the Fed said on Tuesday.

The discount rate tends to move in tandem with the federal funds rate, so the minutes regarding the discount rate suggest that during the first half of September, not all policymakers may have supported raising the federal funds rate.

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