The first FOMC Minutes of 2023 has been released with investors searching for further insights into the near-term path for policy and any comments regarding the possibility of the Federal Reserve going back to 50 bps hikes.
Key notes from FOMC minutes
A few participants favoured raising rates by 50 basis points.
All participants agreed more rate hikes needed to achieve Federal Open Market Committee's job, inflation objectives.
Participants said restrictive monetary policy needed until Fed confident inflation falling to 2%; added that process likely to take 'some time'.
All participants favored further fed balance sheet reductions under current plan.
Participants said uncertainty associated with outlooks for economy, job market and inflation was 'high'.
Participants saw upside risks for inflation, including china's economic reopening and Russia's war in Ukraine.
Participants said risks to economic outlook weighted to downside.
A number of participants said drawn-out US debt limit process could pose 'significant risks' to the financial system, economy.
Participants said job market 'very tight,' labor demand outstripping available supply.
Participants said continued tight job market would contribute upward pressure to inflation.
Participants said inflation in last three months has eased, but they need to see more progress.
Some participants saw elevated prospect of recession in 2023.
US Dollar and Treasury Yields update
The US Dollar ran higher from a new low at 104.25 in the NY session in anticipation of a hawkish outcome ad sat at 104.35 moments ahead of the release.
DXY is moving up to fresh highs on the prospects of a 50bp rate hike next time around. However, the price action is volatile and bears are fading bullish attempts within the first 15 min candle:
US Treasury yields have seen the 10-year stay in familiar territories at 3.929% the post FOMC high.
About the FOMC minutes
FOMC stands for The Federal Open Market Committee which organizes 8 meetings in a year and reviews economic and financial conditions, determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. FOMC Minutes are released by the Board of Governors of the Federal Reserve and are a clear guide to the future US interest rate policy.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.