A deteriorating inflation situation is expected to push Federal Reserve officials to continue to keep raising interest rates even if it tips the U.S. economy into a recession, according to minutes of the June 14-15 policy meeting.

Per CNBC, the members confirmed that the July meeting will likely see a fifty or seventy-five basis point hike. Last month saw the first 0.75-percentage-point rate increase since 1994.

“In discussing potential policy actions at upcoming meetings, participants continued to anticipate that ongoing increases in the target range for the federal funds rate would be appropriate to achieve the Committee’s objectives,” the minutes said.

“In particular, participants judged that an increase of fifty or seventy-five basis points would likely be appropriate at the next meeting,” it continued.

Although the minutes did not mention the risk of recession directly, the central bankers noted that rate hikes will likely continue until inflation, which is running at the highest level since 1981, gets closer to their 2 percent goal.

“Participants concurred that the economic outlook warranted moving to a restrictive stance of policy, and they recognized the possibility that an even more restrictive stance could be appropriate if elevated inflation pressures were to persist,” the minutes said.

“Participants recognized that policy firming could slow the pace of economic growth for a time, but they saw the return of inflation to 2 percent as critical to achieving maximum employment on a sustained basis,” it added.

According to CNN Business, Fed chairman Jerome Powell has acknowledged that future rate hikes could lead to “pain” in the tight labor market. The latest Fed projections have the unemployment rate rising slightly to 4.1 percent from 3.6 percent by 2024.

“We are already seeing some companies start to pull back on hiring, whether through hiring freezes or just quite simply acting slower to fill their existing job openings,” Daniel Zhao, senior economist for Glassdoor, told the business news outlet.

“This is the first step that companies take when they expect the economy to slow down. Invariably, if there is a recession, there are likely going to be layoffs as a result, but the hope is that if the recession is mild, layoffs will be contained, and any increase in unemployment will be smaller as a result,” he continued.

According to data released by the Labor Department on Thursday, weekly jobless claims reached the highest level since January, while the U.S. trade deficit hit its lowest level of the year. Initial filings for unemployment benefits totaled 235,000 for the week ending on July 2—a gain of 4,000 from the previous period and slightly more than the 230,000 estimated by Dow Jones.

Ethen Kim Lieser is a Washington state-based Finance and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.

Images: Reuters.