FOMC Minutes say many officials inclined to stay at zero longer
From the Minutes of the Jan 27-28 FOMC meeting.
- Continued tepid wage growth could restrain spending
- Noted risks from China, Mideast, Ukraine, Greece
- Many officials leaning toward keeping rates lower for longer, given weak inflation and other risks
- Policymakers want more evidence of continued growth and signs of inflation picking up before liftoff
- Actions by foreign central banks (ahem, ECB) have improved the outlook
- Will keep close watch on measures of inflation expectations, but still regard weak prices as likely transitory
- "The increase in the foreign exchange value of the dollar was expected to be a persistent source of restraint on U.S. net exports, and a few participants pointed to the risk that the dollar could appreciate further"
Also see:
- Highlights of the Jan 28 FOMC statement
- Full text of the FOMC statement Jan 28, 2015
- Full text of the FOMC minutes just released
Dovish slant on the minutes and the US dollar is down a half-cent across the board.
Update: The key passage on overseas developments, I warned about commentary on China in the preview.
"The slowdown of growth in China was noted as a factor restraining economic expansion in a number of countries, and several continuing risks to the international economic outlook were cited, including global disinflationary pressure, tensions in the Middle East and Ukraine, and financial uncertainty in Greece."