Monetary policymakers were likewise split on the timeframe for winding down the Fed's multi-trillion-dollar investment holdings, with some arguing the central bank should announce this within "a couple of months", the minutes showed.
Lloyds Banking Group has reshuffled its senior management team, it said on Wednesday, as Britain's biggest mortgage lender prepares for the next phase of its transformation into a leaner, low-risk bank.
The Fed lifted rates in June, signaled one more hike in 2017 in updated projections and spelled out how it would begin gradually unwinding its bond portfolio this year. "That does call into question whether or not we are going to see as aggressive a Fed as they are telling us to expect", said Phipps.
Last month's 8-1 vote to lift the benchmark interest rate another quarter percentage point, its second this year, signaled the Fed's confidence in a growing US economy and the eventual inflationary effects of low unemployment. But there's little clarity to be drawn from this other than the clear division within the Fed.
"These views suggest that a third rate hike this year remains a solid base case, but also that such a hike is unlikely to come before the December meeting", said Roberto Perli, an economist at Cornerstone Macro.
Fed officials, led by chair Janet Yellen, appear to have felt reasonably confident about the economy in June.
Of the officials voting on the rates, only Minneapolis Fed President Neel Kashkari objected. The Fed's preferred measure of inflation is tracking at 1.4 percent over the past 12 months.
Recent US inflation data has slowed further than expected, which caused investors to worry that the Fed would hold off on further interest rate hikes. The Fed would keep some of the proceeds instead of reinvesting them.
In Europe the FTSEurofirst 300 index fell 0.8% to 1,492 and United Kingdom and European government bonds retreated after the European Central Bank's policy statement omitted a long-standing pledge to buy eurozone debt as a way of lowering long-term interest rates to stimulate the economies of the single currency club. Rates were cut once again to 0.25% in August 2016, in an effort to shield against the impacts of Brexit.
The European Central Bank on Thursday releases minutes from its last meeting, with investors on the lookout for clues on whether the bank is closer to tightening policy.
Willem Verhagen, senior economist at NN Investment Partners, believed a fall in the United States stock market would not deter the Fed from gently raising interest rates.
"While North Korea's military ambitions are a background threat for markets, we don't think that this particular geopolitical event is at the stage yet where it will cause a spike in volatility". A few Fed officials noted that stock prices were high relative to traditional methods of valuation.
Another topic that could be an important take-away from the June minutes is the level of concern among officials over financial stability after several, including Yellen, spoke out about high asset prices.
The amount of proceeds would start at $10 billion a month and increase until it reached $50 billion a month.