FOMC minutes: a more hawkish bias in these minutes

The minutes from the Federal Reserve’s March 20-21 meeting monetary policy meeting have been published, revealing that the Committee discussed their outlook for the economy and rates, where all agreed that inflation target should be met in coming months. There is a hawkish bias in these minutes with plenty new o go through.

However, the dollar was little changed so far at the time of writing, slightly bid, VIX steady lower. Gold a little weaker and stocks slightly higher.

  • Almost all agreed gradual rate hikes appropriate.
  • All agreed economic outlook had strengthened in recent months.
  • Strong majority agreed prospect of retaliatory trade actions by other countries as downside risk for US economy.
  • Despite expectations for rising y/y inflation, policymakers agreed that alone would not justify change in projected rate hike path.
  • Several said Fed funds rate will likely need to be above long-term normal rate for a time.
  • Some said future Fed statements might need to signal that policy will shift to being a neutral or restraining factor for the economy.

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About the FOMC minutes

FOMC stands for The Federal Open Market Committee that 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.

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