FOMC Minutes Show Fed Not Worried About Foreign Conditions

“It was observed that if foreign economic or financial conditions deteriorated further, U.S. economic growth over the medium term might be slower than currently expected,” the minutes show.

Still, many participants said the effects of weaker growth abroad are “likely to be quite limited,” with officials noting the share of external trade in the U.S. economy is “relatively small,” effects of dollar fluctuations are “modest,” or that the slowdown in foreign demand “would likely prove to be less severe than initially feared.”

The minutes showed a wide-ranging debate over whether to retain the committee’s pledge to keep interest rates near zero for a “considerable time.” The panel ultimately adopted the suggestion from some participants to add wording emphasizing the timing on rate increases would depend on incoming economic data.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza