FOMC Minutes Shed More Light on the Committee’s Diversity of Views

February 15, 2012

The minutes from the January 24-25th Federal Open Market Committee meeting do not appear to contain game-changing information.  The range of opinions expressed in a variety of speeches by Federal Reserve officials and admissions at last month’s press conference and in the forecasts released then already had highlighted the fact that committee members are not thinking entirely alike.  So it’s not really surprising that a few members might believe that QE3 could be warranted in the near term, that some others wouldn’t rule out a third round of asset buying some time down the road, and that at least one dissenter not only objected to the end-2014 rate guidance but in fact favors a preemptive tightening before then.  On balance since the meeting, the dollar shows minuscule changes against the euro (down 0.3%) and yen (up 0.6%).  The 10-year Treasury yields is four basis points lower, and the S&P 500 has strengthened 2.8%.

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