The Federal Reserve will likely raise interest rates in June if economic data points to stronger second-quarter growth as well as firming inflation and employment, according to minutes from the U.S. central bank's April policy meeting released on Wednesday.
That view, expressed by most Fed policymakers at the last policy meeting, suggests the central bank is much closer to lifting rates again than Wall Street expects.
Prices for futures contracts on the Fed's benchmark overnight lending rate on Wednesday implied that investors only saw a 19 percent chance of a rate increase next month.
But members of the Fed's policy-setting committee said recent economic data made them more confident inflation was rising toward their 2 percent target and that they were less concerned about a global economic slowdown, according to the minutes from the April 26-27 meeting.
"Most participants judged that if incoming data were consistent with economic growth picking up in the second quarter, labor markets continued to strengthen, and inflation making progress toward the committee's 2 percent objective, then it likely would be appropriate for the committee to increase the target range for the federal funds rate in June," according to the minutes.