While the cryptocurrency market was shaken by the developments regarding Binance and its CEO CZ, the minutes of the FOMC meeting were also announced.
Important highlights from the minutes of the FOMC meeting when the agenda is hot are as follows:
- Everyone at the FOMC agrees to “proceed with caution” on interest rates.
- Everyone on the FOMC thinks rates will remain restrictive for a while longer.
- The FED foresees additional tightening if the progress in inflation remains insufficient.
- All participants at the Fed's policy meeting held between October 31 and November 1 agreed that the interest rate-setting committee was in a position to proceed cautiously.
- All participants found it appropriate to keep the target interest rate at 5.25%-5.50%.
- Most Fed officials saw upside risks to inflation.
- Many Fed officials saw downside risks to growth.
- All participants agreed that policy decisions at each meeting would continue to be based on the totality of incoming information.
- Participants agreed that maintaining a restrictive attitude would support greater progress toward goals while allowing time to gather additional information.
- Participants noted that additional policy tightening would be appropriate if there was information showing that progress towards the inflation target was insufficient.
- Participants noted that inflation had moderated over the past year but remained unacceptably high and well above the 2% target.
- Participants assessed that supply and demand in the economy continue to come into better balance.
- Participants stated that only limited progress had been made in reducing inflation in basic services, excluding housing.
- FED staff's economic forecasts were similar to September forecasts.
- Many participants think that the increases in long-term treasury bond yields are due to the increase in the term premium.
- Participants emphasized that they need to see more data showing inflation pressures are easing to be more confident that price increases will return to 2%.
At the October 31-November 1 meeting, the minutes of which were published, the FED decided not to increase interest rates and left interest rates constant.
Powell said at an International Monetary Fund research conference earlier this month:
“Inflation has caused us some confusion. If it becomes appropriate to tighten policy further, we will not hesitate to do so. But we will continue to tread carefully, both against the risk of being misled by a few months of good data and the risk of over-tightening.”
A New York Fed study released on Tuesday, which is the result of a broad general model of the economy, found that the US central bank's late start to raise interest rates, with the first increase coming a year after prices began to rise sharply, actually allowed the economy to grow further with the same progress in reducing inflation. He claimed that he did.
The delayed start forced the Fed to raise rates faster and at a higher rate than it otherwise would have, but the net effect was “positive
*This is not investment advice.