Monetary Policy Focus: The Federal Reserve Meeting Minutes

May 22, 2023

In the coming week, market attention will centre on the minutes from the Federal Reserve’s monetary policy meeting. The consensus among Federal Reserve members is that inflation is likely to return to the 2% target, a goal yet to be accomplished. Despite the robust demand for jobs and recent positive economic data suggesting a rebound, it’s predicted that the Fed will underline that a rate cut is not on the cards for 2023.

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Impact of Global Tightening on Monetary Policies

However, the recent sharp tightening of monetary policies globally has had ripple effects on banking operations. The chairman of the Federal Reserve has suggested that we are nearing the apex of interest rates. It is anticipated that the United States will soon enter a period of interest rate hike suspension to mitigate the risk of the economy spiralling back into recession. Therefore, it is expected that the Fed’s monetary policy meeting minutes will persist in conveying a dovish message to avoid exacerbating market turbulence.

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