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Fed July meeting minutes due to shed light on rate-hike support
The Fed held the fed funds range at 3.5% to 3.75% in July, but three officials voted for a 25 basis point hike.
The US Federal Reserve will release the minutes from its July FOMC meeting on Wednesday, a document investors will use to gauge how hawkish the central bank remains after a meeting that included three dissenting votes for a rate increase, FXStreet reports.
At that July meeting, the Fed left the fed funds target range unchanged at 3.5% to 3.75%. FXStreet says regional Fed Presidents Lorie Logan, Beth Hammack and Neel Kashkari backed a 25 basis point rate hike, underscoring internal differences over whether further tightening is warranted.
FXStreet notes the policy statement did not provide explicit guidance for future decisions, consistent with Fed Chair Kevin Warsh’s preference for reducing forward guidance and keeping flexibility. The minutes are expected to be scrutinized for whether the hawkish arguments extended beyond the three dissenters and whether additional officials considered a hike before settling on a hold.
FXStreet also points to shifting macro data since July, including moderating July CPI and PPI readings and an employment report showing a larger-than-expected decline of 23K jobs in July, alongside downward revisions to prior months. It says Wells Fargo economists expect the minutes to indicate most officials are inclined to wait for more progress on inflation, while keeping the bar for future hikes relatively low if price pressures fail to ease further.