Response to the Federal Open Market Committee May meeting minutes released Wednesday in the US.

Greg's post here: FOMC May meeting minutes: Patient approach appropriate to policy for some time

Quick snippet via Nordea's take …

(TL;DR

most of the members agree the fall for core inflation is mainly transitory

thus expect there will be no precautionary rate cut

but will watch for any further inflation falls which could bring a cut)

  • participants observed that inflation pressures remained muted
  • core inflation lower than expected
  • but that many of the "participants viewed the recent dip in PCE inflation as likely to be transitory, and participants generally anticipated that a patient approach to policy adjustments was likely to be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective."
  • minority of members viewed the downside risks to inflation as having increased
  • A precautionary rate cut as the markets has been chatting about seems therefore not to be in the cards
  • Fed doesn't completely rule out a rate cut if inflation developments disappoint going forward
  • fairly upbeat assessment of the real economy
  • a number of participants mentioned that they had marked up their projections for real GDP growth
  • "members noted that financial conditions had improved since the turn of the year, and many uncertainties affecting the U.S. and global economic outlooks had receded, though some risks remained"
  • Since early May the trade conflict has made this judgment somewhat stale