What the FOMC Minutes Signal About Inflation and Rates

The transcript discusses the Federal Reserve's considerations regarding inflation and potential rate hikes. Initially, inflation was seen as transitory, but now broader global trends are being considered. The impact of hurricanes on economic data complicates decision-making. The voting roster for the December meeting shows uncertainty about a rate hike, with market expectations at 75-80%. The Fed may adjust expectations based on upcoming data, particularly the CPI. Overall, the Fed is cautious, balancing market expectations with economic realities.

What are policymakers considering as a potential cause for the inflation backslide?

• Technological advancements

• Broader global trends

• Political instability

• Local economic policies

What is the main concern regarding the voting roster for the December meeting?

• Lack of experienced members

• Insufficient support for a rate hike

• Too many hawks in the voting roster

• Overwhelming support for a rate hike

What is the current market expectation for a rate hike in December?

• 80% to 90%

• 50% to 60%

• 60% to 70%

• 75% to 80%

Which upcoming economic data is expected to show big spikes in certain price categories?

• Retail sales figures

• Gross Domestic Product (GDP)

• Consumer Price Index (CPI)

• Unemployment rate

How might the Federal Reserve respond if the economic data does not support a rate hike?

• Increase the rate hike probability

• Proceed with the rate hike regardless

• Back off from the rate hike

• Ignore the economic data