Several Federal Reserve policymakers wanted to drive home the idea that their asset-purchase program would be trimmed in predictable, $10-billion steps unless the economy's performance surprises them, according to minutes of the U.S. central bank's last policy meeting.
Minutes of the Fed's Jan. 28-29 policy meeting, which was former chairman Ben Bernanke's last, showed the officials were nearing a decision how to adjust a promise to keep interest rates low for a while to come.
At the meeting, the Fed ultimately decided to make a second modest cut to its bond-buying program, which now runs at $65 billion per month. It made the move despite turmoil at the time in emerging markets brought on in part by the withdrawal of Fed stimulus.
"Several participants argued that, in the absence of an appreciable change in the economic outlook, there should be a clear presumption in favor of continuing to reduce the pace of purchases by a total of $10 billion at each (policy) meeting," said the minutes, which were released on Wednesday.
Beyond the expected cut to bond buying, the Fed at the meeting made no changes to its other main policy plank: Its pledge to keep interest rates low for some time to come.
The Fed has promised to keep interest rates near zero until well after the U.S. unemployment rate, now at 6.6 percent, falls below 6.5 percent, especially if inflation remains below a 2 percent target. Fed officials have recently said they expect to alter this guidance soon, given how close the jobless rate now is to the rate-hike threshold.
The minutes reinforced that notion, and raised the possibility that financial stability concerns should play a bigger role in the decision on when to tighten policy.
"Several participants suggested that risks to financial stability should appear more explicitly in the list of factors that would guide decisions about the federal funds rate once the unemployment rate threshold is crossed.." the minutes said.
It was the first meeting without a dissent since June 2011, a sign of how tumultuous Bernanke's tenure has been.