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FX OPTION EXPIRY (for Monday)

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Underperforms in EGBs

US TSY FUTURES

Yld Curves Extend Steeper

RUSSIA

Inflation Expectations Rise in June

WASHINGTON (MNI) - The following is an excerpt from the Federal Open 
Market Committee minutes of the September 25 - 26 meeting, published 
Wednesday:
     Participants offered their views about how much additional policy 
firming would likely be required for the Committee to sustainably 
achieve its objectives of maximum employment and 2 percent inflation. A 
few participants expected that policy would need to become modestly 
restrictive for a time and a number judged that it would be necessary to 
temporarily raise the federal funds rate above their assessments of its 
longer-run level in order to reduce the risk of a sustained overshooting 
of the Committees 2 percent inflation objective or the risk posed by 
significant financial imbalances. A couple of participants indicated 
that they would not favor adopting a restrictive policy stance in the 
absence of clear signs of an overheating economy and rising inflation. 
     Participants reaffirmed that adjustments to the path for the policy 
rate would depend on their assessments of the evolution of the economic 
outlook and risks to the outlook relative to the Committees statutory 
objectives. Many of them noted that future adjustments to the target 
range for the federal funds rate will depend on the evaluation of 
incoming information and its implications for the economic outlook. In 
this context, estimates of the level of the neutral federal funds rate 
would be only one among many factors that the Committee would consider 
in making its policy decisions. 
     
     ** MNI Washington Bureau: (202)371-2121 ** 
[TOPICS: MMUFE$,M$U$$$,MT$$$$]