20 Aug 2015
FOMC minutes: Doubts on core view deepen - Nomura
FXStreet (Bali) - According to Nomura's North America Economics Team, the Minutes to the July FOMC meeting revealed some significant doubts about the core view that the US slowdown in growth and inflation was temporary.
Key Quotes
"For most of this year, the dominant view within the FOMC has been that the slowdown in growth and inflation was temporary and as the year went on, things would improve. That was the consensus within the Committee."
"The Minutes to the July FOMC meeting, however, revealed some significant doubts about that core view. Those doubts reflect the fact that the recovery is incomplete."
"i.e., we have not gotten back to the growth rates we saw in Q2 and Q3 of last year. They also reflect the fact that inflation has continued to languish. Finally, poor economic performance abroad continues to place limits on the US recovery."
"It appears that the Committee may want more evidence that inflation, and particularly core inflation, is moving toward its objective before deciding to raise interest rates."
Key Quotes
"For most of this year, the dominant view within the FOMC has been that the slowdown in growth and inflation was temporary and as the year went on, things would improve. That was the consensus within the Committee."
"The Minutes to the July FOMC meeting, however, revealed some significant doubts about that core view. Those doubts reflect the fact that the recovery is incomplete."
"i.e., we have not gotten back to the growth rates we saw in Q2 and Q3 of last year. They also reflect the fact that inflation has continued to languish. Finally, poor economic performance abroad continues to place limits on the US recovery."
"It appears that the Committee may want more evidence that inflation, and particularly core inflation, is moving toward its objective before deciding to raise interest rates."