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FOMC Minutes recap – Nomura

FXStreet (Barcelona) - The Research Team at Nomura highlights the key points from the FOMC Minutes while noting that the Minutes were generally balanced with a few 'dovish' surprises.

Key Quotes

“The discussion largely reflected, in subtle ways, the more "hawkish" tone of the October FOMC statement. But the minutes were generally balanced, and they offered some "dovish” surprises, most notably on the prospects of near-term changes in the forward guidance and a potential clarification of their inflation target.”

“The discussion of forward guidance provided no clear indication that the Committee intends to drop the “considerable time” language at the December meeting. It could still happen, but they provided no obvious signal.”

“The discussion did not suggest any outsized concerns about risks to the outlook from foreign developments and financial market volatility. Given the statement, this was not a surprise.”

“The Committee also seems quite sanguine about downside risks to inflation and inflation expectations. This view may be challenged at the December meeting due to additional declines in oil prices, and market-based measures of inflation expectations since the October meeting, as well as some recent evidence of declines in long-term inflation expectations.”

“Finally, the Committee expects the unemployment rate to decline only “gradually.” That judgment seems at odds with recent performance and may be tested in coming quarters.”

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