FOMC minutes: Some members see the need for raising rates above neutral

The minutes from the Federal Reserve’s September 25-26 monetary policy meeting have been published with key highlights, via Reuters, found below.

• Members viewed the recent data as consistent with an economy that was evolving about as they had expected. 
• A few participants expected that policy would need to become modestly restrictive for a time.
• A number of participants judged that it would be necessary to temporarily raise the federal funds rate above their assessments of its longer-run level in order to reduce the risk of a sustained overshooting of the Committee's 2 percent inflation objective or the risk posed by significant financial imbalances. 
• Consequently, members expected that further gradual increases in the target range for the federal funds rate would be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective over the medium term.
• In global markets, strains in emerging market economies (EMEs) contributed to volatility in currency and equity markets over the period.
• In addition, concerns about trade tensions between the United States and China were the focus of a great deal of attention among market participants.
• Trade tensions weighed on foreign equity prices, as the United States continued its trade negotiations with Canada and placed additional tariffs on Chinese products.

About 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.