The US Federal Reserve Board (FRB) released the minutes of the US Federal Open Market Committee (FOMC) held on the 1st and 2nd on the 23rd. While many were skeptical that high inflation would end, the majority argued that a slowdown in the pace of rate hikes would likely be appropriate in the near future. He suggested that the central bank has entered a phase of searching for the ultimate goal of the policy interest rate, while looking at the cumulative effects of monetary tightening thus far.
At this meeting, it was decided to raise the interest rate by 0.75% for the fourth straight meeting. The target for the Federal Funds (FF) interest rate, an indicator of short-term interest rates, is 3.75-4.0%. In a statement released after the meeting, the Fed said it would “take into account the time lag between monetary policy affecting economic activity and prices” when deciding on the pace of future rate hikes.
Many FOMC participants say there is “little sign of an end” to high inflation. As for the reasons why a slowdown in interest rate hikes is still necessary, he cited the fact that financial conditions are approaching a sufficiently tight state and the uncertainty over how quickly the effects of monetary policy will affect the real economy. rice field.
After decelerating the pace of rate hikes, if high inflation persists, it is expected that the number of rate hikes will be increased to make the ultimate target of the policy rate higher than expected. At this year’s FOMC meeting, many participants pointed out that the target rate hike would be “slightly higher than previously assumed.” FOMC participants indicated in September that the median forecast of 4.6% for the year-end 2023 policy rate will be higher when the hike ends.
(Source: Nihon Keizai Shimbun)
The majority of the participants argued that it would likely be appropriate to slow down the pace of interest rate hikes in the near future.
As the US enters Thanksgiving Day, it is assumed that the trend of USD selling will continue, although price fluctuations will be less likely.
