June 2015 FOMC Minutes: The Fed is worried about Greece

Jessica Morris
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The Fed said failure to resolve the debt Greek crisis could have "possible spillover effects" (Source: Getty)

Minutes from the Federal Reserve's June meeting show officials want to see further evidence the economy is picking up before they hike rates, and are concerned about the Greek debt crisis.

The minutes from its meeting June 16-17 show officials have been pleased by positive economic developments such as strong consumer spending and signs wages are starting to rise more quickly. However, they want to see more of these before ending a policy of zero interest rates.

"Members thus saw economic conditions as continuing to approach those consistent with warranting a start to the normalization of the stance of monetary policy," the minutes said.

"[But] all members but one indicated that they would need to see more evidence that economic growth was sufficiently strong and labor market conditions had firmed enough to return inflation to the committee’s longer-run objective over the medium term."

The minutes predate the collapse of the Greek debt talks, as well as stock market turmoil rattling China. However, officials had flagged concern that failure to reach a deal could lead to "spillover effects".

"Many participants expressed concern that a failure of Greece and its official creditors to resolve their differences could result in disruptions in financial markets in the euro area, with possible spillover effects on the United States," it said

They also highlighted concern about economic growth "abroad, particularly in China and other emerging market economies."

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