20.08.202518:09:12UTC+00FOMC Minutes: Inflation Risks Outweigh Job Concerns

The minutes from the Federal Reserve's July meeting indicate that nearly all officials were in favor of maintaining interest rates at 4.25%-4.50%. However, dissent came from Michelle Bowman and Christopher Waller, who advocated for a quarter-point rate cut to bolster a weakening job market. This view gained importance following Labor Department's data, which highlighted weaker job creation in July, a rise in the unemployment rate, and significant downward adjustments to previous job growth figures, leading President Trump to dismiss the head of the Bureau of Labor Statistics (BLS). Despite these labor market concerns, inflation remains a pressing issue, exacerbated by President Trump's tariff policies. Both consumer and producer prices have surged beyond expectations. Officials are currently debating the extent to which tariffs are contributing to inflation and if the existing policy remains too constrictive. Market sentiment suggests an 85% probability of an interest rate cut in September, with anticipation building around Federal Reserve Chair Jerome Powell's upcoming speech at Jackson Hole on Friday, where he is expected to outline his position.