Highlights of the minutes of the June 16-17 FOMC meeting:
- Many Fed officials expressed concern about Greece
- Most participants "judged that the conditions for policy firming had not yet been achieved"
- Only some said conditions for raising rates had been met or would be met soon
- One member ready to raise rates in June but willing to wait
- A number of Fed officials warned against premature rate rise
- Fed officials gave a number of reasons for caution over outlook
- Some officials saw risk weak first half could restrain sales
- Several officials voiced uncertainty about Chinese growth pace
- Most officials wanted further progress is utilization of labor resources
- Some said utilization gap would close by year's end
- Full text
An interesting tidbit in the minutes is that the Fed will switch to calculating the Fed funds effective rate to the volume-weighted median instead of rate-based mean.
There are $2.6 trillion in excess reserves on deposit compared to $2 billion in 2007 and that has the Fed scared that it won't be able to manage the Fed funds rate during liftoff. The change -- they say -- is not to emphasize trades at rates "unrepresentative of general market conditions."
