FOMC minutes: All participants viewed near-term economic outlook as having deteriorated sharply

According to the minutes from the Federal Open Market Committee's (FOMC) unscheduled March 15 monetary policy meeting, all participants viewed the near-term US economic outlook as having deteriorated sharply in recent weeks and as having become profoundly uncertain.

Market reaction

The market reaction to the FOMC statement was largely muted. As of writing, the US Dollar Index was up 0.15% on a daily basis at 100.12.

Additional takeaways

"Many participants had repeatedly downgraded their outlook of late in response to the rapidly evolving situation."

"All saw US economic activity as likely to decline in the coming quarter and viewed downside risks to the economic outlook as having increased significantly."

"Participants noted that the timing of the resumption of growth in the US economy depended on the containment measures put in place, as well as the success of those measures, and on the responses of other policies, including fiscal policy."

"Participants expressed concern that households with low incomes had less of a savings buffer with which to meet expenses during the interruption to economic activity."

"This situation made those households more vulnerable to a downturn in the economy and tended to magnify the reduction in aggregate demand associated with the nation's response to the pandemic."

"Participants stressed that measures taken in the areas of health care policy and fiscal policy, together with actions by the private sector, would be important in shaping the timing and speed of the US economy's return to normal conditions."