Key Takeaways From Minutes of Fed’s December Meeting on Rates

Here are key takeaways from minutes of the Federal Reserve’s Dec. 13-14 meeting, released Wednesday:

(Bloomberg) — Here are key takeaways from minutes of the Federal Reserve’s Dec. 13-14 meeting, released Wednesday:

A number of officials stressed that the decision to step down to a 50 basis-point hike, following four straight 75 basis-point increases, “was not an indication of any weakening of the committee’s resolve to achieve its price-stability goal” nor a judgment that inflation was persistently slowing
Fed warns financial markets not to underestimate the central bank’s resolve to bring down inflation, as minutes cite policymakers saying: “An unwarranted easing in financial conditions, especially if driven by a misperception by the public of the committee’s reaction function, would complicate the committee’s effort to restore price stability”
Risk of higher inflation seen as a “key factor” shaping outlook for policy
Minutes give little hint on whether the next rate hike is more likely to be 25 or 50 basis points, saying the FOMC “would continue to make decisions meeting by meeting”
Staff economic outlook was less weak than in prior FOMC meeting; staff sees the possibility of a recession as a “plausible alternative to the baseline” after previously viewing odds at close to 50-50

For Bloomberg’s TOPLive blog on the Fed minutes, click here

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