FOMC minutes didn't provide strong clues on the direction of rates
FOMC minutes didn't provide strong clues on the direction of rates, but there's been little market reaction. Most officials saw the July cut as a "mid-cycle adjustment," as indicated by Chair Powell. A number of participants note the various risks weighing on the outlook, and the "absence of clarity regarding when those risks might be resolved, highlighted the need for policymakers to remain flexible and focused on the implications of incoming data for the outlook." The other key element of the minutes was that "Members generally agreed that it was important to maintain optionality in setting the future target range for the federal funds rate and, more generally, that near-term adjustments of the stance of monetary policy would appropriately remain dependent on the implications of incoming information for the economic outlook." Meanwhile, two participants wanted a 50 bp easing, though obviously they did not dissent. They favored a stronger action to better address the stubbornly low inflation rates of the past several years. Probably Bullard and perhaps Evans were the two. Read the minutes.