FOMC Minutes Signal Rate-Hike “Soon”, Economic Weakness Probably “Transitory” But Need “Evidence”

Jon Politics

Having top-ticked US economic data with its March rate-hike, all eyes are on the May minutes to confirm the total lack of data-dependence now present at The Fed. The main focus of the minutes was on the ‘normalization’ of the balance sheet (since June hike odds are at 100%), which was confirmed with details of the plan revealed. Economic weakness in Q1 was shrugged off as “transitory” – although with the provision that evidence is needed – and tightening as well as balance sheet rolloff is appropriate “soon”, likely signaling that a June rate hike is on despite the recent economic slowdown. Fed also warns of asset valuations.
Key Minutes Headlines:
*MOST FED OFFICIALS SAW TIGHTENING LIKELY APPROPRIATE `SOON’ *FED BALANCE-SHEET PLAN WOULD RAISE ROLLOFF CAPS EVERY 3 MONTHS *FOMC VOTERS: PRUDENT TO AWAIT EVIDENCE SLOWDOWN IS TRANSITORY

This post was published at Zero Hedge on May 24, 2017.