PU Prime App

Exclusive deals on mobile

  • Market Insights  >  Weekly Outlook

18 August 2022,03:31

Weekly Outlook

FOMC Minutes Reveals Fed’s Inflation Fears

18 August 2022, 03:31

Share on:
Share on:

On Wednesday, 17 August (GMT+3), the Federal Open Market Committee (FOMC) released the minutes for its 26-27 July meeting. In it, the Fed has finally decided to take a step back to assess the effects of aggressive monetary tightening. For the past few rate hikes, which saw increases as high as 75 points, the Fed has always defended its decision by pointing out the robustness of the US jobs market. With the outsized Nonfarm Payrolls for July – 528K vs a forecasted 250K – the Fed continues to be proven right about the jobs market.

Fed Chair Jerome Powell has said during the minutes that “it likely will become appropriate to slow the pace of increases while we assess how our cumulative policy adjustments are affecting the economy and inflation.” Similarly, the minutes also showed that some Fed members have expressed concern about over-aggressive rate hikes, and that moves should be based more on data instead of forward guidance. 

In other words, the Fed looks like it will consider slowing down the pace of tightening based on ongoing numbers until inflation slows to its desired 2% level. 

While inflation measured by the CPI seems like it peaked in July, it is still 8.5% higher than a year ago. The fed’s preferred measure of inflation, the PCE, is up 6.8% year on year. 


With the Fed’s fears of over-hiking (and tipping the US into a recession) being firmly established, the markets have been cautious about making big moves. 

While major indices surged at the start of the announcement, most of them pared down subsequently and ended the day lower – with the S&P 500 down 0.72%. Volatility based on the VIX has also decreased, although it remains “significantly above pre-pandemic levels. 

Meanwhile, the greenback has edged up 0.14%, with the Dollar Index currently at the 106.6 level. This comes on the back of the push factor of a weakening pound and euro; and the pull factor of dovish guidance from the Fed. 

Gold meanwhile, fell to the $1760 level briefly after the minutes, but has since climbed back to the $1765 level. 

In the money markets, traders are almost evenly split between betting on a 50-point and 75-point hike in the Fed’s September meeting. 

Investors are advised to pay close attention to the upcoming US Initial Jobless Claims figures, which will be released on 18 August, 15:30 (GMT+3) – which will give further clues on the development of the US jobs market. As a  friendly reminder, do keep an eye on market changes, control your positions, and manage your risk well.

엣지 있게 거래 시작하기

업계 최저 스프레드와 초고속 실행으로 FX, 지수, 귀금속 등을 거래하실 수 있습니다!

  • 당사의 스탠다드 계좌는 최소 $50달러로 거래를 시작할 수 있습니다.
  • 24시간 연중무휴 고객지원
  • 수백 개의 거래 도구, 무료 교육 도구 및 최고의 프로모션을 누릴 수 있습니다.
지금 가입하기

Latest Posts

쉽고 빠른 계좌 개설

  • 1


    몇 가지 간단한 과정으로 PU Prime의 실거래 계좌를 개설하세요

  • 2


    다양한 입출금 수단과 수용되는 통화로 손 쉽게 계좌에 예치할 수 있습니다

  • 3


    업계 최고의 거래 환경과 조건에서 수백 개의 상품을 거래하세요

Please note the Website is intended for individuals residing in jurisdictions where accessing the Website is permitted by law.

Please note that PU Prime and its affiliated entities are neither established nor operating in your home jurisdiction.

By clicking the "Acknowledge" button, you confirm that you are entering this website solely based on your initiative and not as a result of any specific marketing outreach. You wish to obtain information from this website which is provided on reverse solicitation in accordance with the laws of your home jurisdiction.

Thank You for Your Acknowledgement!

Ten en cuenta que el sitio web está destinado a personas que residen en jurisdicciones donde el acceso al sitio web está permitido por la ley.

Ten en cuenta que PU Prime y sus entidades afiliadas no están establecidas ni operan en tu jurisdicción de origen.

Al hacer clic en el botón "Aceptar", confirmas que estás ingresando a este sitio web por tu propia iniciativa y no como resultado de ningún esfuerzo de marketing específico. Deseas obtener información de este sitio web que se proporciona mediante solicitud inversa de acuerdo con las leyes de tu jurisdicción de origen.

Thank You for Your Acknowledgement!