FOMC Minutes: June rate hike “unlikely” - update

FXStreet (Córdoba) - Minutes from the Federal Reserve April 28-29 meeting showed only “a few” members anticipated data would support a June rate hike, while many participants thought that was unlikely, although they generally did not rule one out.

Clearly, FOMC members maintain different views about the likely timing and pace of a rate hike, but most agreed the decision would depend on upcoming data. Overall, minutes suggest the liftoff could occur at any meeting.

“A few anticipated that the information that would accrue by the time of the June meeting would likely indicate sufficient improvement in the economic outlook to lead the Committee to judge that its conditions for beginning policy firming had been met”, minutes said. “Many participants, however, thought it unlikely that the data available in June would provide sufficient confirmation that the conditions for raising the target range for the federal funds rate had been satisfied, although they generally did not rule out this possibility”.

"Most" Fed officials thought the weakness in first quarter growth was transitory or due to statistical noise, “with little implication for the pace of expansion beyond the near term”, but acknowledged increased uncertainty about the outlook.

Fed policymakers see a strong dollar as "likely to continue to be a factor restraining U.S. net exports and economic growth for a time," according to April meeting minutes released today.