US Fed rate hike in June 'likely', minutes show

NEW YORK

It is "likely" the Federal Reserve will increase interest rates in June, according to minutes of the April meeting of the Federal Open Market Committee (FOMC) released Wednesday.

Most FOMC members said that if macroeconomic data in the following weeks suggest economic growth picking up in the second quarter, labor market conditions continue to strengthen and inflation moving toward the Fed's 2 percent objective, then it "likely would be appropriate" for the FOMC to raise rates next month, the minutes read.

In addition, most of the 10-member committee pointed to improved labor market conditions and stated that job gains and real income growth are expected to boost consumer spending and business investment in the second quarter.

There are still external downside risks the Fed sees against consumer spending in the U.S., however, such as the U.K.'s possible exit from the EU, unexpected developments in the Chinese economy and its exchange rate policy.

Members appeared divided on external risks. "Several FOMC participants judged that the risks to the economic outlook were now roughly balanced. However, many others indicated that they continued to see downside risks to the outlook ... because of remaining concerns about the global economic and financial outlook," according to the minutes.

The dollar jumped against the euro, Japanese yen, and the Chinese yuan, and the Turkish lira, following the release of the minutes, pushing oil prices into negative territory.

International benchmark Brent crude fell to $48.80 per barrel, while American benchmark West Texas Intermediate slid to $48 -- both losing almost 1 percent.

The Dow Jones and the S&P 500 each erased earlier gains while the Nasdaq was struggling to stay positive.