Courtesy of Gus Lubin of The Business Insider
The August FOMC minutes are out! Here are some highlights:
- Three members wanted to take stronger action at the August meeting
- Some members wanted to set explicit targets for unemployment and inflation
- Fischer dissented because he thought nonmonetary factors were limiting growth
- Kocherlakota dissented because unemployment had improved, while inflation had risen, since QE2 was launched
- Plosser thought the reference to 2013 "might well be misinterpreted as suggesting that monetary policy was no longer contingent on how the economic outlook evolved
- Tools discussed for September include additional asset purchases, increasing the average maturity of the System’s portfolio, and a reduction in the interest rate paid on excess reserve balances.
No big moves in the market following the release.
When Bernanke called for a two-day meeting in September, it was speculated that he would try to try to get a consensus for more action. None of the dissenters, however, sound likely to support more easing. Of course he can still announce QE3 with dissent. (Many market observers think Bernanke will do some form of QE3 regardless of dissenters – the market seems to think so too. ed.)
In the August 9 statement the Fed extended super-low rates through mid-2013, said it was prepared to use more tools if warranted, while three members dissented.
A joint meeting of the Federal Open Market Committee and the Board of Governors of the Federal Reserve System was held in the offices of the Board of Governors in Washington, D.C., on Tuesday, August 9, 2011, at 8:00 a.m.
