WASHINGTON (REUTERS) - The Federal Reserve has been surprised by how quickly the US labour market is healing but doesn't want to bring forward a planned rate hike until the recovery looks more convincing, according to minutes of its last policy meeting.
"Labour market conditions had moved noticeably closer to those viewed as normal in the longer run," according to the minutes of the central bank's July 29-30 meeting, which were released on Wednesday.
Policymakers "generally agreed" that improvements in the labour market over the last year had been "greater than expected," according to the minutes.
The Fed had said in its policy statement following the meetings that there was "significant" slack in the labour market, but the minutes showed many members of the Fed's policy-setting committee thought this characterisation "might have to change before long."
They also showed officials had largely agreed on many elements of a framework for raising interest rates, with almost all policymakers agreeing it would be appropriate to retain the overnight federal funds rate as their key target.