FOMC minutes: what to expect
FXBAZOOKA.com - The FOMC meeting minutes are due today at 18:00 GMT.
Analysts at Standard Chartered think that any hawkish surprise (and, consequently, the positive effect for USD) in the FOMC July minutes is likely to be limited – the hawks already had the Philadelphia Fed President Plosser’s dissent and the accompanying statement.
The Fed’s forward guidance is that there will be a “considerable time” between the end of QE and the first rate hike. Standard Chartered says that the key in the minutes will be whether the FOMC is considering revising it. In their view, the central bank won’t say so and this phrase will remain in its statement after the next FOMC meeting in September as well, because the Fed realizes that to an earlier rate hike would mean to disappoint the market players which enjoy cheep financing in the US.
Analysts at RBC Capital Markets expect an overall dovish theme to persist, but warn that the Fed might be done with concerns about lower inflation – and this is a hawkish moment.