Gold has gained notably since The Fed hiked rates in March (as stocks have suffered) and the yield curve has collapsed, hardly signaling market confidence in the Jerome Powell's first rate-hike. But it appears the critical highlights from the meeting are a positive outlook on Trump's growth agenda...
- *FED SEES `SIGNIFICANT' FISCAL-POLICY GROWTH BOOST NEXT FEW YRS
But anxiety over Trump's Trade wars...
- *STRONG MAJORITY OF FED OFFICIALS SAW TRADE WAR AS DOWNSIDE RISK
Notably, as the dots revealed, there are a few hawks and doves who established the endpoints around the more centrist views, but the minutes offered little additional clue as to who they were.
Stocks down, bonds & bullion up...Participants did not see the steel and aluminum tariffs, by themselves, as likely to have a significant effect on the national economic outlook, but a strong majority of participants viewed the prospect of retaliatory trade actions by other countries, as well as other issues and uncertainties associated with trade policies, as downside risks for the U.S. economy."
"Tax changes enacted late last year and the recent federal budget agreement, taken together, were expected to provide a significant boost to output over the next few years."
"A few participants noted that the changes in tax policy could boost the level of potential output."
"Almost all participants agreed that it remained appropriate to follow a gradual approach to raising the target range for the federal funds rate."
"A number of participants indicated that the stronger outlook for economic activity, along with their increased confidence that inflation would return to 2 percent over the medium term, implied that the appropriate path for the federal funds rate over the next few years would likely be slightly steeper than they had previously expected."
"Some participants suggested that, at some point, it might become necessary to revise statement language to acknowledge that, in pursuit of the Committee’s statutory mandate and consistent with the median of participants’ policy rate projections in the SEP, monetary policy eventually would likely gradually move from an accommodative stance to being a neutral or restraining factor for economic activity."
"A couple of participants pointed to possible benefits of postponing an increase in the target range for the federal funds rate until a subsequent meeting; these participants suggested that waiting for additional data to provide more evidence of a sustained return of the 12-month inflation rate to 2 percent might more clearly demonstrate the data dependence of the Committee’s decisions and its resolve to achieve the price-stability component of its dual mandate."
"Participants expressed a range of views on the amount of policy tightening that would likely be required over the medium term to achieve the Committee’s goals."
"Many participants stated that recent readings from indicators on inflation and inflation expectations increased their confidence that inflation would rise to the Committee’s 2 percent objective in coming months and then stabilize around that level; others suggested that downside risks to inflation were subsiding."
"All participants agreed that the outlook for the economy beyond the current quarter had strengthened in recent months. In addition, all participants expected inflation on a 12-month basis to move up in coming months."
"Regarding wage growth at the national level, several participants noted a modest increase, but most still described the pace of wage gains as moderate; a few participants cited this fact as suggesting that there was room for the labor market to strengthen somewhat further."
"Participants noted incoming data suggesting some slowing in the rate of growth of household spending and business fixed investment after strong fourth-quarter readings. However, they expected that the first-quarter softness would be transitory, pointing to a variety of factors, including delayed payment of some personal tax refunds, residual seasonality in the data, and more generally to strong economic fundamentals."
