The Minutes of the FOMC meeting January 26-27 revealed Wednesday that policy makers said the pace of recovery in economic activity and employment had moderated in recent months.
Featured statements – Reuters
“Some members of the FOMC pointed out that economic conditions are currently far from the longer-term goals, they must remain accommodative until they are achieved.”
“All members supported the January political decision.”
“Participants emphasized that it is important to abstract from short-term factors that affect inflation when judging progress toward the goal.”
“The FOMC members judged that it will likely take some time to make more substantial progress on QE.”
“Participants saw progress in vaccines as essential to supporting greater gains in consumer spending and the overall economic recovery.”
“Policy makers noted the importance of communicating well in advance of any change in the pace of bond purchases.”
“They judged that the low level of labor force participation likely reflected factors including health concerns and additional child care responsibilities.”
“Many FOMC members emphasized the importance of distinguishing between unique relative price changes and the underlying trend of inflation.”
“Participants generally anticipated that inflation would increase over time.”
“Members noted that overall financial conditions remained very accommodative.”
“Some policy makers saw relatively tight credit conditions for some borrowers.”
“They see more uncertainty around the outlook.”
“Many participants see the risks of new virus strains, possible public resistance to vaccination, and difficulties in distribution and production.”
“Many participants emphasized that sustained support for fiscal policy would help address the difficulties faced by the groups most affected by the recession, particularly low-income, black and Hispanic households.”
“Several participants saw upside risks to inflation due to supply restrictions.”
Market reaction
This statement does not appear to have a noticeable impact on the performance of the dollar against its rivals. At the time of writing, the US dollar index it was up 0.5% on the day at 90.95.
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