FOMC minutes to Januayr 29, 30 meeting:
FOMC minutes to Januayr 29, 30 meeting: officials still saw a strong labor market, along with household spending, but there was some moderation in business investment, in line with expectations. Inflation remained near 2%. The statement also noted that downside risks had increased with concerns over trade, slowing in global, tighter financial conditions, fiscal policy, and the government shutdown. It was also noted that "some market reports suggested that investors perceived the FOMC to be insufficiently flexible in its approach to adjusting the path for the federal funds rate or the process for balance sheet normalization in light of those risks." The minutes also said "balance sheet runoff and associated 'quantitative tightening' had been an important factor contributing to the selloff in equity markets." And, "Almost all participants thought that it would be desirable to announce before too long a plan to stop reducing the Federal Reserve's asset holdings later this year." On rates, "many" suggested it wasn't yet clear on what rate action might be appropriate late this year. The minutes were right in line with our expectations, and that included no concrete news on the balance sheet, and a patient approach to rate policy. There's been little market reaction.