June 18-19 FOMC minutes: Mixed Views, But Shift.>

FED: June 18-19 FOMC minutes: Mixed Views, But Dovish Shift

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- Many participants indicated the case for cuts had strengthened and 

downside risks had "risen materially" since May meeting. 

- Nearly all wanted to hold rates steady at June meeting, a couple 

wanted an immediate cut. Those waiting wanted to gather more info.

- Many participants said "additional" policy accommodation WOULD be 

warranted if recent downside developments were sustained. 

- Several others participants noted "additional" policy MIGHT be 

warranted if the outlook deteriorates further.  

- Variety of views on need for lower rates: cushion in case of future 

shocks (SEVERAL), smaller upward contribution to inflation from tight 

resource utilization (SEVERAL), shortfall in inflation (SOME), need to 

lift inflation expectations (FEW), desire to allow inflation to go above 

2% to bolster commitment to symmetric objective (FEW)

- Alternatively, a few participants worried that cutting rates to lift 

inflation slightly could overheat labor markets.

- A number of participants saw return to 2% inflation taking longer than 

previously thought despite low FFR. 

- Discussed standing repo facility design, but made no decisions