FED Policy Splits Markets, Minutes may Offer Clues

The FED paused after raising rates 10 times in a row, even as inflation cooled less than expected.
Meanwhile, policymakers have forecast two more rate hikes this year, beating market expectations, a confusing outcome that has investors looking for answers.
Kathy Bostjancic, chief economist at Nationwide Life, said the FED and Powell “sent a mixed message that reflected an awkward compromise between the hawks and doves on the committee.
The minutes may offer some insight into this, but may just repeat the awkward explanation Powell offered. ”
Derek Tang, an economist at monetary policy analysis firm LH Meyer, said the minutes could reinforce market expectations for a rate hike in July.
“A rate hike in July is not a certainty, but it is quite likely because if they don’t raise rates in two consecutive meetings, it will be difficult to assert that the rate hike cycle is still in place.”
However, the minutes are expected to remain as flexible as possible: peak rates are likely to be higher, and views on the appropriate timing (to leave rates on hold) are wide-ranging.