Fed Meeting Minutes Preview: May Hint at End of Taper

October 9th: An institutional analysis has pointed out that some analysts hold the view that the minutes of the September meeting might suggest that Federal Reserve officials are beginning to think about ending the balance sheet tapering in a tighter financing market environment. Nevertheless, based on the meeting minutes, there is little evidence indicating that this topic was extensively discussed. During the September meeting, the staff at the Federal Reserve Bank of New York informed the officials that by the end of the first quarter of 2026, bank reserves are projected to decline to around $2.8 trillion, which implies that there is no immediate need to end the quantitative tightening at the next one or two meetings. The officials did stress that "it is crucial to keep a close eye on the money market situation." (FXStreet)

On October 9th: The gap among Federal Reserve officials regarding the future course of interest rates is expanding. However, the majority think that further rate cuts are needed this year. The minutes of the Fed's September meeting, which were released on Wednesday, indicated that the committee is grappling with conflicting economic signals and having difficulty reaching a consensus on whether stubborn inflation or a soft labor market is the more pressing issue. The minutes showed that Fed officials unanimously agreed that due to the recent weak employment data, a rate cut was necessary. But there was disagreement among officials about the future path. Nevertheless, the minutes showed that "most believe that further policy easing in the remaining time of this year may be appropriate." Nevertheless, some policymakers "pointed out that from several indicators, financial conditions suggest that monetary policy is not particularly restrictive, and they believe a cautious approach is neces

October 9th. The minutes of the Federal Reserve meeting stated that all participants unanimously held the view that recent indicators suggest a slowdown in economic activity during the first half of this year. In order to reflect the latest labor market conditions, they agreed to no longer describe the labor market situation as "robust" but rather to characterize it as having seen a slowdown in employment growth and a slight upward movement in the unemployment rate while still remaining at a low level. All participants unanimously agreed that inflation remains somewhat elevated and also agreed to add that inflation has increased to a certain extent. They further agreed that the Committee should focus on the risks to its "dual mandate" and added that the downside risks to employment have grown, reflecting their concerns about the labor market. To support the Committee's goals and taking into account the changes in the risk balance, almost all members were in favor of lowering the fede

October 9th: In the Federal Reserve meeting minutes, it was mentioned that regarding the inflation outlook, participants generally anticipated that with appropriate monetary policy, inflation would remain at elevated levels in the near term and then gradually decrease to 2%. Several participants noted that business contacts indicated that they would gradually raise prices due to input cost pressures resulting from tariffs. Although the impact of this year's tariff hikes on inflation remains undetermined, the majority of participants expected these effects to be fully manifested by the end of next year. Some participants believed that the labor market was not expected to be a source of inflationary pressures. (FXStreet)

On October 9th, the minutes of the Federal Reserve meeting stated that officials held the view that inflation expectations had been firmly anchored. The majority of officials indicated that this year might be a suitable time for further policy easing. (ForexLive)

On October 9, "The Fed's Whisperer" Nick Timiraos stated: The minutes of the Fed meeting suggest that the number of people in favor of no rate cuts may be more than half a percentage point greater than those in favor of rate cuts. (Xinhua News Agency)