The Federal Reserve authorities agreed to this Monetary policy It should remain in the restrictive zone for some time to continue to cool inflation, although it is noted that the risks of “excessive restrictions” need to be more balanced.
“Participants generally viewed that with the stance of monetary policy in restrictive territory, risks to achieving the Committee’s objectives have become more bilateral,” according to the minutes of the September meeting, which were published in Washington on September 11.
“All participants” agreed that the FOMC was In a position to “proceed with care” Policy decisions will be data-driven and take into account the “balance of risks.”
The minutes show that Fed officials are moving towards a symmetrical policy forecast, as… Risk of overfitting And Recession They oppose prolonged inflation above 2%.
At the September meeting, Fed officials kept the benchmark interest rate in a range of 5.25-5.5% and indicated that interest rates would remain higher for longer than expected.
since then, – Increased long-term Treasury bond yields That has prompted some officials to suggest they may postpone another increase when they meet from October 31 to November 1.
After the minutes were released, the two-year Treasury yield rose, Sensitive to Federal Reserve policyThe dollar trimmed its gains today, while the Standard & Poor’s 500 index trimmed its losses.
The Fed discusses interest rates
The minutes noted that a “majority” of Fed officials believe further interest rate increases “are likely to be appropriate” to help cool demand and bring inflation closer to the 2 percent inflation target, while “some” said “these increases… “It will not be justified.” “.
In forecasts issued last month, 12 of 19 officials They expected another increase this year, while the average estimate showed they expected smaller interest rate cuts in 2024 and 2025.
“Participants generally indicated that it is important to balance the risk of overfitting with the risk of underfitting,” the minutes noted.
An expected rise in interest rates, coupled with a slowing pace of cuts over the next two years, has sent bond markets tumbling over the past three weeks.
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