-Brian Bethune, an economics professor at Fisk University
The minutes of the latest FOMC meeting showed Fed officials were worried about the possible effect of the Greek debt crisis on the US economy. They also voiced concerns about future growth in China, the world's second largest economy, and other emerging markets. The developments abroad could potentially derail the US economy in part by pushing the US Dollar higher and hurting US exports. Thus, central bankers agreed that there were still a number of uncertainties both at home and overseas to lift interest rates from all-time lows. While economists had predicted the US central bank to hike interest rates in September, the recent deadlock on Greek debt and the precipitous plunge in China's stock market have urged many experts to expect a delay until the end of the year. However, policy makers highlighted the rebound that had occurred in the US since it stalled in the beginning of the year. The progress was seen in various sectors including manufacturing and housing.
The International Monetary Fund reiterated its view that the Fed should be patient with interest rate hike, as the think-tank downgraded markedly the growth outlook for the world's number one economy. The IMF cut the estimate for 2015 growth to 2.5%, down from the 3.1% forecast in the April World Economic Outlook. It predicted GDP growth would pick up to 3% next year, followed by a 2.7% gain in 2017 and 2.5% growth in 2018.
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