According to the minutes of the Federal Reserve’s March meeting, released this afternoon, everything is on the table.
Here’s a quote that sums up the thrust of the minutes, in my opinion.“Several participants noted that their views of the appropriate target range for the federal funds rate could shift in either direction based on incoming data and other developments.”
What this quote doesn’t say, however, is that if you add up all the Fed’s worries and hopes, you definitely come out with more worries than hopes.
Yes, the Fed is worried about a slowdown in global growth and that’s a reason to pause the schedule of interest rate increases.And, yes, it worries that the stimulus of the December 2017 tax cut has started to fade.And that Brexit might slow growth in Europe. And that consumers and CEOs seem to be spending with more caution.
On the other hand, average wages are still climbing, even if slowly, the economy is still producing jobs at a good pace, and there’s no sign that inflation is picking up speed.The consensus from the meeting, if I can add my summary conclusion, is that growth will slow to 2.1% in 2019 and that means the Fed will be on the sidelines for 2019 without a rate increase or cut.
But that could all change.
