Post on the Federal Open Market Committee (FOMC) minutes on Wednesday:
Asia is waking up to do its assessment. This an early one via BNZ (in brief):
- FOMC minutes ... unsurprisingly hawkish
- Fed appears set on hiking the policy rate by either 50bps or 75bps at the upcoming meeting later this month
- a restrictive policy stance was seen as warranted given the strength of inflation and tightness in the labour market
- the minutes flagged the possibility of an “even more restrictive stance” if elevated inflation pressures were to persist
- there was no sign in the minutes that the Fed is thinking of wavering from its strategy, even with a growth slowdown in train and equity markets in ‘bear market’ territory ... participants “recognized that policy firming could slow the pace of economic growth for a time, but they saw the return of inflation to 2% as critical to achieving maximum employment on a sustained basis.”
Daily USD index:
