Fed staff sees one U.S. rate hike this year, inflation stuck in low gear

WASHINGTON (Reuters) - Staff at the Federal Reserve's Board of Governors see a single quarter-point U.S. interest rate increase by year's end, inflation stuck in low gear for five more years and an economy growing more slowly than expected by U.S. policymakers.

Those bearish projections were included in a set of staff forecasts presented to policymakers at their June 16-17 meeting and inadvertently posted on the Fed's website on June 29.

The forecasts do not represent the views of the central bankers who set America's interest rate policy. Those policymakers, many based outside of Washington in regional Fed branches, create their own forecasts.

But Board of Governors' staff views are sensitive and influential enough that the Fed normally releases them five years after they were made.

The disclosure was a result of "procedural errors" at a staff level, a Fed spokeswoman said. The matter has been referred to the Fed Board's Inspector General, the Fed said in a statement.

(Reporting by Jason Lange and Howard Schneider; Editing by Chizu Nomiyama and Steve Orlofsky)

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