Highlights of the March 20 FOMC Minutes:
- Several officials noted that rate views could shift either way
- Majority of policymakers said patience needed
- Majority saw rates on hold through 2019
- Several officials concerned yield curve quite flat
- Fed noted significant uncertainties around the outlook
- Uncertainty remained high over Brexit and trade but that risks of adverse outlook had fallen
- Some said economy could rebound and warrant a rate hike late in the year
- No officials said expected that a rate cut would be needed this year
- Time would be needed to assess whether Q1 weakness would spill into Q2
- Saw less of a boost from fiscal policy than expected
- Most likely outcome was a sustained expansion
- Full text
Key passage:
"Several participants noted that their views of the appropriate target range for the federal funds rate could shift in either direction based on incoming data and other developments. Some participants indicated that if the economy evolved as they currently expected, with economic growth above its longer-run trend rate, they would likely judge it appropriate to raise the target range for the federal funds rate modestly later this year."
There is some focus on the line that rates could move in either direction as a small hint on cuts but at the same time, there's hardly something to push the odds of a cut above the current rate at 58%. This truly is a wait-and-see Fed.
