BNP commentary on the FOMC December meeting Minutes

  • Inflation data ahead of FOMC's March meeting is unlikely to increase worries and/or uncertainty about inflation failing to return to target
  • The minutes provided less information about central bank's reaction function "than we were hoping for"
  • BNP particularly note that discussions of low inflation and the fact that many participants were more uncertain about inflation outlook and/or saw important downside risks to their forecasts

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BNP have their own inflation forecasts (higher) and suggest that if these are correct then the Fed will hike again in March.

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(Earlier on the Minutes, here:

  • Hilsenrath: Fed members had "significant concern" about inflation level The
  • Dollar moves lower initially after FOMC minutes
  • FOMC Minutes: Almost all officials agreed liftoff conditions met in Dec

)