NEW YORK ( TheStreet) -- While the minutes of the Federal Reserve's March meeting show some central bankers prefer a June rate hike, recent economic data might be too weak for hiking rates so soon, one economist said.
"There was a little bit more emphasis [of a June rate hike] in the minutes," said Michelle Meyer, deputy head of U.S. economics at Bank of America Merrill Lynch (BA) - Get Boeing Company Report. "Now that we got that weak jobs report and the flow of data continues to come in pretty soft, expectations are probably shifting out; September seems like it's a more likely outcome."
The economy added only 126,000 jobs in March, missing expectations of 247,000. Still, stocks rallied on speculation that weak employment data would delay a rate hike, potentially even into 2016.
New York Federal Reserve Chairman William Dudley told Reuters on Wednesday that a June liftoff was still "in-play."
But Meyer doesn't think the current environment warrants higher rates. "I think the reason Fed officials are continuing to note that June is on the table is because they really want to reinforce this message to the market that the Fed has flexibility. There's no forward guidance. They don't have a dovish bias, but they have a neutral bias."
During the March meeting, central bankers stripped forward guidance from its statement by removing the 'patience' language installed in its statement in December.
The Fed insists the disappearance of 'patience' doesn't mean higher rates are imminent.
"Members noted that the timing of the first increase would depend on the evolution of economic conditions and the outlook, and that the change in the forward guidance was not intended to indicate that the committee had decided on the timing of the initial increase in the target range for the federal funds rate," the minutes said.