**MNI 5 THINGS:FOMC Mins:Almost All Saw June Hike Appropriate>

--5 Things We Learned From The Minutes Of The June 12-13 FOMC Meeting

By Kevin Kastner, Sara Haire, Shikha Dave, and Harrison Clarke

     WASHINGTON (MNI) - The following are the key points from the 

minutes of the June 12-13 FOMC meeting released Wednesday:

     - The Minutes showed that almost all participants wanted a rate 

increase, but one participant would have preferred to wait to allow 

inflation expectations to rise to levels consistent with the Fed's 

objective. 

     - After removing the portion of the statement referring to the 

funds rate remaining below longer run levels for a time, the minutes 

show that a number of participants noted it may soon be appropriate to 

also modify the language that policy "remains accommodative." 

     - Most participants noted "uncertainty and risks associated with 

trade policy had intensified" and suggested that could eventually 

negatively impact business sentiment and investment, pointing out that 

contacts in some districts had already scaled back capital spending 

plans due to these concerns. 

     - On the yield curve, some participants noted outside factors, such 

as the rise in the funds rate, the reduction of investors' estimates of 

the longer-term real rate, and lower levels of term premiums, may reduce 

the reliability of the yield curve shape as a predictor of economic 

downturn. However, several others doubted that these factors were 

impacting the usefulness of the curve, and number of participants agree 

it should continue to be monitored. 

     - The minutes suggested that participants saw fiscal policy as a 

positive for growth "over the next few years," with a few seeing fiscal 

policy as an "upside risk." A few others worried that fiscal policy "is 

not currently on a sustainable path." 

     ** MNI Washington Bureau: 202-371-2121 ** 

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