Fed minutes could reveal whether rate hikes are being made or just paused



Investors may have a better idea of ​​the Federal Reserve's position on interest rates on Wednesday when the minutes of the last meeting will be released.

Inventories have increased especially since the last meeting, optimistic about the possibility for policymakers to raise rates.

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Some even think that the Fed's next decision could be to reduce the benchmark rate in the short term, which has not been done since December 2008, when the global financial crisis forced the central bank to cut rates to zero. , according to the Wall Street Journal.

Loretta Mester, president of the US Federal Reserve Cleveland, said Tuesday that interest rates are expected to rise slightly this year assuming the economy is growing at the expected pace.

Much of the disagreement over the Fed's next rate change comes from its decision in January to remove the explicit reference to future rate increases from its monetary policy statement. Prior to the January meeting, the central bank had included this language in all its declarations since 2015.

Futures on federal funds – used by traders to place bets on the course of monetary policy – show market prices with a 0.9% probability that the Fed will raise rates at least once. here the end of the year, against 30% a month ago, according to the CME group.

Some analysts remain skeptical of the Fed's rate hike: the economy seems much stronger than the Fed's latest decision to lower interest rates.

Some parts of the economy are starting to show signs of weakness. These include a slowdown in the housing sector and a loss of consumer confidence.

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In addition, December's retail sales report is very weak.

The global economy has also been hit hard by the trade war between the United States and China and the threat of increased tariffs.


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