FOMC minutes: Indicators of longer-term inflation expectations are little changed, on balance

The minutes from the Federal Reserve’s July 31-August 1 monetary policy meeting have been published, with key highlights found below.

Key highlights (via Reuters)

• Labor market has continued to strengthen and that economic activity has been rising at a strong rate.
• Escalating trade tensions between China and the United States prompted notable market moves, particularly in foreign exchange markets.
• News on an agreement between the United States and the European Union to continue talks to resolve their trade disputes provided some support for global equity prices. 
• Indicators of longer-term inflation expectations are little changed, on balance.
• Trade policies could move in a direction that would have significant negative effects on economic growth. 
• Participants observed that if a large-scale and prolonged dispute over trade policies developed, there would likely be adverse effects on business sentiment, investment spending, and employment. 
• Further gradual increases in the target range for the federal funds rate will be consistent with the sustained expansion of economic activity, strong labor market conditions, and inflation objective.
• Risks to the economic outlook appear roughly balanced.
• The stance of monetary policy remains accommodative, thereby supporting strong labor market conditions and a sustained return to 2 percent inflation.