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Fed looked past weakness to press ahead on rate hike plan

The United States Federal Reserve Board building is shown in Washington October 28, 2014. REUTERS/Gary Cameron

WASHINGTON (Reuters) - U.S. Federal Reserve officials acknowledged risks from overseas and a weak start to the year at their March meeting but remained confident enough in the strength of the recovery to continue laying the groundwork for an interest rate hike later this year, according to minutes from the meeting released on Wednesday.

The meeting concluded with the Fed opening the door to a June rate hike, and the minutes said that "several participants" went on record saying they expected upcoming economic data would warrant an initial rate increase that month.

But even those less certain about the June timing felt the economy had improved enough for the Fed to shift into a meeting-by-meeting assessment of whether rates should move higher.

Even in the face of a weak first quarter, "participants saw broad-based improvement in labor market conditions ... including strong gains in payroll employment ... While almost all participants noted potential risks to the economic outlook resulting from foreign economic and financial developments, most saw the risks to the outlook for economic growth and the labor market as nearly balanced," the minutes said.

Staff forecasts, meanwhile, projected that even though U.S. economic growth had slowed, it would remain strong enough to continue making progress towards the Fed's inflation and unemployment goals - particularly after the impact of a strong dollar and falling oil prices started to ease.

(Reporting by Howard Schneider; Editing by Paul Simao)