Jan FOMC Minutes Preview (1/2): Watching For Taper And IOER Hints

Sell-side outlooks for the minutes of the January FOMC meeting (out 1400ET) below.

• Most focus is on any discussion on potential timing of asset purchase tapering, and any insight into how the FOMC views the balance of risks shifting on inflation/growth given rising likelihood of fiscal stimulus since the Dec meeting.
• Anything on IOER / RRP hikes (as pointed out by MNI's Exclusive yesterday as looking likely in the next few months) also of interest.
• Citi says there is potential for hints of "a more robust debate about tapering for later this year" in the minutes, but the messaging will remain that such discussion is "premature" for now. Citi also looks for any hints the FOMC is becoming more constructive on the inflation outlook.
• Deutsche expects the minutes to point to upside growth risks given likely fiscal stimulus, but that the FOMC views "the threat of an unwanted inflation overshoot remains low". Few specifics seen on tapering other than reiterating that guidance will be provided "well in advance".
• ING sees risks from the minutes pointing to "higher rates for now, as they may paint a more nuanced picture than the dovish broad brushes used by Fed Powell and others" since the meeting. That said, Powell's congressional testimony next week could present an opportunity for the Fed and Powell to "take some steam" out of the recent move in rates.