Minutes released early Wednesday show four of 12 Reserve Bank boards voted days
before the July FOMC to raise the primary credit (discount) rate by 25bps. The
FOMC on July 28-29 voted 9-3 to hold policy rates; the discount-rate votes
underscore internal disagreement. Dallas, Cleveland and Minneapolis boards
backed a 25bp increase and their presidents had voted against holding rates
steady at the July meeting; the Kansas City board also voted for a 25bp rise,
though its president, Schmid, did not have a vote this year. Reserve Bank
directors do not set policy rates but inform regional presidents’ economic and
policy outlooks; the Fed’s policy-rate target range has been 3.5%-3.75% since
December.
