On October 12, Eastern Time, Feder released the minutes of the September interest rate meeting. The minutes of the meeting showed that participants observed that U.S. inflation was still "unacceptable" and far higher than the Fed's 2% long-term target of 2%.
participants commented that the recent inflation data in the United States is generally higher than expected, and accordingly, inflation has declined slowly than they had previously expected. Price pressure remains high and continues to exist in a wide range of categories. Energy prices have declined in recent months, but are still far higher than the 2021 level, and the upward risk of energy prices remains.
Regarding the outlook for the US economy, participants pointed out that recent data indicate that US economic activity will grow "moderately" in the second half of this year. Among them, recent consumer spending and business investment indicators indicate that these expenditure categories have increased slightly, but some interest rate-sensitive industry activities have significantly weakened.
participants generally expect that as monetary policy adopts a restrictive position, the slowdown in the global economic growth rate of continues to exist, and the labor market becomes less tense in the future, the US economy will grow at a "below trend" rate this year and in the next few years.
When considering the appropriate monetary policy stance, participants reiterated their firm commitment to return inflation to the 2% target, and many stressed the importance of sticking to this goal even in the case of a slowdown in the labor market.
When discussing possible policy actions for the next few meetings, the minutes showed that attendees continued to expect that maintaining a target range for raising the federal funds rate would be beneficial to achieving the committee’s goals. The Commission needs to turn to and maintain a more restrictive policy stance to meet the Commission's dual goals of full employment and price stability.
Among them, several participants pointed out that in the current highly uncertain global economic and financial environment, the pace of monetary policy should be adjusted in the future to reduce the risk of worsening economic outlook. Once the policy reaches a sufficiently restrictive level, it will be appropriate to maintain that level for a period of time.
Many participants stressed that the cost of “taking too little action to reduce inflation” may outweigh the cost of taking too much action. Several of the participants stressed that restrictive positions should be maintained as long as possible when necessary, and historical experience shows that it is dangerous to end the policy cycle of austerity currency prematurely when fighting inflation.
Forex, the US dollar further appreciates against most major currencies, reaching decades highs against the euro, pound and yen. Federal Reserve officials believe that the dollar's strengthening largely reflects intensified investors' concerns about the global growth outlook and the widening of the spread between the United States and Japan. Growth concerns have also suppressed stock prices in various countries, with funds from emerging markets continuing to flow out, and the net credit spread value of emerging markets economies narrowing.
