By Martin Crutsinger
WASHINGTON (AP) - Federal Reserve officials spoke with increased urgency at their last meeting about the need to provide more help for a weak U.S. economy.
Many members felt further support would be needed "fairly soon" unless the economy improved significantly, the minutes of the July 31-Aug. 1 meeting show. The minutes didn't say what steps might be taken. The boldest move would be to launch a new program of bond buying to try to lower long-term interest rates to encourage more borrowing and spending.
The minutes show many officials favored pushing the timetable for any increase in record-low short-term rates beyond the Fed's current plan of at least late 2014. Many economists think the target will be extended to mid-2015. This language might be altered at the September meeting, the minutes indicate.
Early reaction in the stock market was positive but muted. The Dow Jones industrial average rose modestly. It was down about 70 points at 2 p.m. Eastern time, when the Fed minutes were released, and down 30 points several minutes later. The yield on the benchmark 10-year U.S. Treasury note dipped slightly, to 1.74 percent from 1.75 percent earlier.
The price of gold, which traders sometimes buy as a hedge against inflation, jumped about $10 an ounce, to $1,650, its highest point since early May.
The minutes released Wednesday cover the July 31-Aug. 1 policy meeting. The Fed releases the minutes of its private discussions three weeks after each meeting. The policy committee will meet next Sept. 12-13.
After its August meeting, the Fed announced no changes to policy. But in a statement afterward, it appeared to signal a growing willingness to take further steps to boost the economy if it doesn't improve. The Fed noted that growth had slowed in the first half of the year. In particular, it pointed to lackluster job growth and consumer spending.
The issue of whether the Fed will actually change policy in a major way in September has been thrown into doubt by recent economic indicators showing a bit more strength in such areas as hiring and consumer spending.
Many analysts are looking to a speech by Federal Reserve Chairman Ben Bernanke at an annual Fed conference in Jackson Hole, Wyo., to possibly provide more guidance on the Fed's next moves.