Fed officials not aligned on weight of financial conditions

By Michael S. Derby Oct 28 (Reuters) One issue dividing Federal Reserve officials over whether more interest rate hikes are needed as soon as this week is just how much weight to put on the loose financial conditions that many outside the US central bank see as a key driver of inflation in an accelerating economy. Financial conditions — denoted by things like short- and long-term borrowing costs and stock prices — ​are a key variable because the changes the Fed makes to the cost of short-term credit rely on markets to translate them to ‌broader borrowing costs. On balance, a central bank that is on a rate-hike path to combat half a decade of above-target inflation would likely boost interest rates at the two-day meeting that is scheduled to conclude on Wednesday. But guidance from key officials suggests a majority of Fed policymakers will support leaving the central bank s benchmark interest rate unchanged after unanimously agreeing to lift it by a quarter of a percentage point to th