MADRID, 21 Nov. (EUROPA PRESS) –
Within the Federal Open Market Committee (FOMC) of the United States Federal Reserve (Fed) there was unanimity on the need to “proceed with caution” in the face of future monetary policy meetings, according to the minutes of its last monetary policy meeting, held on October 31 and November 1.
“All participants agreed that the Committee was in a position to proceed with caution and that the political decisions of each meeting would continue to be based on all the information received,” explained the document released this Tuesday.
At the last meeting, it was decided to maintain interest rates in a target range of 5.25% to 5.5% for the second consecutive time, their highest level since 2001.
The minutes reveal that the FOMC preferred to wait and have more data that would “clarify” to what extent the disinflation process was advanced, whether aggregate demand was moderating or whether the labor market “was reaching a better balance between supply and demand.” .
Likewise, Committee members reported that the recent rise in US ten-year bond yields to 16-year highs could lead to “persistent changes in financial conditions with implications for monetary policy.”
Consequently, the markets will be monitored closely given that both the permanence over time and the causes of this circumstance are “uncertain” and their profits potentially “volatile.”
The importance would be that a tightening of financial conditions would translate into effects similar to those produced by additional increases in the reference rate.
Regarding inflation, it “has moderated in the last year”, but the FOMC has insisted that it remains at “unacceptably high levels and well above the long-term objective” of price stability.
In this sense, the Fed’s decision-making body has also agreed that more evidence will be necessary to certify that “inflation is, without a doubt, on a path that leads to the objective […] of 2%.”
