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The leaders of the Federal Reserve pointed to uncertainty about the future of monetary policy in United States at the December Federal meeting Open Market Committee (FOMC), said the minutes of the meeting, released Wednesday. "Members agreed that the timing and magnitude of future interest rate adjustments would depend on their badessment of expected economic conditions in relation to the maximum employment and inflation targets. ", says the report.
The minutes indicate that politicians have reiterated that the more cautious badessment would take into account a wide range of information, including measures of the labor market situation, inflationary pressure indicators. and inflation expectations, as well as readings on financial and international developments. . Fed policymakers also noted a contrast between the strength of data received by the FOMC and market concerns, as well as tighter financial conditions with falling stock prices, and felt that they could make proof of patience in defining the policy of the establishment. .
The badessment of Fed officials was mainly motivated by the concern of the markets for the global economy, which also pointed out that companies are more concerned about the global economy and have indicated that it was important to badess the risks before any further changes in interest rates. According to the minutes, the risks are balanced, but the negative risks for the economy have increased.
Several executives also noted the continued weakness of the real estate market, but noted that fixed investment in businesses remained strong, despite the slowdown, and that labor market conditions remained strong, while in the United States .
In its paper, the Fed noted that, outside the United States, economic growth had remained at a moderate pace in the third quarter of 2018, while the recovery of emerging markets offset the slowdown advanced economies, whose weakness reflected temporary leading factors. According to the minutes, the economic recovery in Brazil and Mexico offset the slowdown in China and India, while the fourth quarter data showed consistency with the moderation of the economy outside the United States .
Some executives, however, pointed out that tighter financial conditions did not limit real activity, but pointed out that the risks could reduce the estimates of activity and inflation. In this sense, leaders have expressed concern that inflationary expectations will remain weak as the economy continues to evolve in line with expectations. In the most uncertain scenario, the December FOMC meeting minutes indicated that policymakers had observed that the Fed's policy was not on a predefined path, while the team of central bank economists stressed that the private sector was degraded. profit for 2019, while companies were concerned about commercial rates.
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