Don’t Relax. The Fed’s Hawks Are Flexing Their Talons
The latest minutes show governors ready to err on the side of tightening, and a hike of 50 basis points can’t be taken off the table.
The Fed’s governors seem distinctly inclined to err on the side of hawkishness.
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The last time the Federal Reserve published the minutes of its latest meeting on monetary policy, in the first week of this year, it set off a dramatic shift in the market’s expectations that still continues. The minutes to its January meeting, which were published Wednesday and you can find here, were a drab affair by comparison. Stocks enjoyed a bounce, though not a particularly big one. The yield curve steepened sharply. That tells us more about the markets than it does about the content of the minutes.