Fed minutes: rate hike later rather than sooner

Fed officials indicated in the minutes from the last meeting that a rate hike is contingent upon the economic recovery. And in my view, much will depend on how quickly the economy generates new jobs.

The minutes noted that the Fed's current language that interest rates will stay low for an extended period is not designed to box policymakers in by explicitly telegraphing to the financial markets that rates will stay near zero for several more months.

"A number of members noted that the Committee's expectation for policy was explicitly contingent on the evolution of the economy rather than on the passage of any fixed amount of calendar time.

"Consequently, such forward guidance would not limit the Committee's ability to commence monetary policy tightening promptly if evidence suggested that economic activity was accelerating markedly or underlying inflation was rising notably; conversely, the duration of the extended period prior to policy firming might last for quite some time and could even increase if the economic outlook worsened appreciably or if trend inflation appeared to be declining further."

Still, despite relatively upbeat economic reports that have come out recently, most officials anticipate a modest recovery and some warned against raising rates too soon.