Before the federal reserve meeting this month, investors were still waiting for the hope that the central bank would soon restart the interest rate drops it has paused in January. But a few minutes from this gathering, underlines how proven civil servants were at their waiting approach in the midst of extreme uncertainty about the economic prospects.
A recording of Meeting from May 6 to 7 of the FedReleased on Wednesday, underlined the overwhelming support among those responsible to hold reduction rates until they have more clarity on President Trump’s policies and how the economy reacted to whip priceTax reductions, immigration restrictions and other cornerstone of the agenda of its administration.
“Participants have agreed that with economic growth and the labor market that is always solid and the current monetary policy moderately restrictive, the committee was well placed to wait more clarity on the prospects of inflation and economic activity,” said the minutes.
The uncertainty about the prospects had become “unusually high,” said officials: “making him appropriate to adopt a cautious approach until the net economic effects of the range of changes to government policies become clearer.”
The meeting took place just before some of the most aggressive tariffs against China were temporarily interrupted, a decision that has helped to alleviate the fears that the Americans soon faced with shortages and that the economy was heading for much greater slowdown. Even if Mr. Trump announced trade agreements with certain countries, he increased tensions with others, including threatening 50% prices on European Union imports last week before delaying them a few days later.
The officials concluded during the May meeting that the prices increased at that time had been “much larger and wider than they had planned,” said the report.
