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10/9, 8:05 PM (Source: TeleTrader)
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FOMC minutes show divide on further rate cuts

Federal Open Market Committee's (FOMC) minutes from its October meeting showed on Wednesday that the central bankers were divided on when to stop the easing cycle.

During the meeting, several policymakers noted the statistical models suggested that the likelihood of a recession occurring over the medium term had increased notably in recent months. The members of the central bank's committee warned forecast risks "were tilted to the downside", as business fixed investment and exports had weakened since its July meeting. Further, the Fed officials have grown more concerned with risks associated with the trade war and geopolitics.

However, officials noted the United States' growth was generally solid and current conditions remained strong, with "robust" consumption and an employment picture that continued to improve. Because of the strong numbers, several members favored holding the rate cut unchanged, stating the uncertainties wouldn't derail the expansion. They expressed concerns over the financial stability risks that low-interest rates pose and warned that cutting rates now would leave the central bank with fewer options to act the next time a slowdown emerged.

Breaking the News / MD