US May1-2 meeting FOMC minutes on 23.05.2018

  • Modest inflation overshoot ‘could be helpful’
  • See above trend GDP growth through 2020-
  • It’s important to monitor the yield curve slope
  • Officials saw trajectory of fiscal policy difficult to forecast
  • Participants generally viewed the risks to the economic outlook to be roughly balanced.
  • It was noted that the potential for higher Chinese tariffs on key agricultural products could, in the longer run, hurt U.S. competitiveness.
  • strength in the labor market was showing through to a gradual pickup in wage increases
  • Most participants viewed the recent firming in inflation as providing some reassurance that inflation was on a trajectory to achieve the Committee’s symmetric 2 percent objective on a sustained basis
  • Members agreed that the timing and size of future adjustments to the target range for the federal funds rate would depend on their assessments of realised and expected economic conditions relative to the Committee’s objectives of maximum employment and 2 percent inflation
  • The rise in nominal U.S. Treasury yields was associated with an increase in inflation compensation that, in turn, seemed to reflect a firming in inflation data as well as a notable rise in crude oil prices.
  • ze link to the report

USD loses a bit of steam on the apparent will to let inflation overshoot a tad . June rate hike now priced in at 100%.
Overall not more than a 0.1% move . Equity markets smalls better bid.

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