The minutes of the US Federal Bank (FED) showed that most of the FED officials would be appropriate to reduce the policy interest this year, while some authorities did not think of interest rate reductions due to inflation risks.
The FED published the minutes of the Federal Open Market Committee (FOMC) on June 17-18.
The minutes of the last meeting, in which the policy interest rate was kept constant in the range of 4.25-4.50 percent in line with expectations, showed that the FED officials thought that economic uncertainty was high due to changes in trade, finance, migration and regulatory policies.
Records, real gross domestic product (GDP) growth and employment forecasts are considered to be still downward, but the risk of recession was less seen.
FED officials said that tariffs can create upward pressure on prices, but many officials, but many officials think that the impact of increasing tariffs can take time to the final goods prices.
“Most of the authorities said that the upward pressure on inflation caused by tariffs may be temporary or modest, medium and long -term inflation expectations have been well eradicated or some slimming may occur in economic activity and labor market conditions, and that some reduction will probably be appropriate for the federal fund ratio this year.” his statements were included.
In the event that several officials develop in line with the expectations of the data, it will be open to evaluating a reduction in the target range for the policy interest in the next meeting, while some authorities think that it was appropriate to have no reduction in the policy interest in the policy interest due to the upward risks for inflation and the expectations of the economy will remain resistant.
In the minutes, “Some officials commented that the current target range may not be far above the neutral level for the federal fund rate.” The expression was used.
Fed’s next meeting will be held on 29-30 July.
