Latest Fed Minutes Point to June Rate Hike

The transcript discusses a committee meeting held on May 2nd and 3rd, focusing on the potential for a June rate hike. It highlights the agreement on not ceasing asset reinvestments and the debate over inflation and unemployment trends. The committee considered recent economic data, including strong April payrolls and weak CPI data, which influenced their decision-making. A proposal for gradually increasing caps on treasury and agency securities was also discussed, with most policymakers expressing support.

What was the committee's stance on reinvestments of assets on the balance sheet?

• They decided to cease reinvestments immediately.

• They agreed to continue reinvestments from one month to the next.

• They were undecided on the reinvestment strategy.

• They planned to increase reinvestments significantly.

What was the committee's view on the weak GDP and inflation data?

• They believed the data was permanent.

• They considered the data to be transitory.

• They ignored the data completely.

• They thought the data was irrelevant.

What concern did some committee members have regarding inflation?

• Inflation might overshoot as unemployment falls.

• Inflation was expected to decrease significantly.

• Inflation was too low to be a concern.

• Inflation was not related to unemployment.

How did the recent April payrolls data influence the committee's decision?

• It had no impact on their decision.

• It supported the idea of delaying a rate hike.

• It supported the Hawks who wanted a rate hike in June.

• It led to a decision to lower rates.

What was the committee's proposal regarding the balance sheet?

• To maintain current levels indefinitely.

• To decrease caps on securities runoff.

• To gradually increase caps on securities runoff.

• To immediately stop all treasury and agency securities.