Fed still afraid of doing 'too little' on inflation

FOMC minutes

The Federal Reserve is still concerned that the cost of coming down too strongly on inflation is “likely outweighed” by the cost of failing to do enough.

Minutes released yesterday (12 October) detailed the thought process behind the Fed's decision last month to make the third in a series of 0.75% rate hikes. Officials said they continue to remain committed to "purposefully" tightening monetary policy in the face of "broad-based and unacceptably high inflation". The minutes also show a Fed that is still surprised by the rate of rising prices, describing "higher-than-expected inflation", as well as emphasising the need to "purposefully moving to a restrictive policy stance in the near term". Risk appetite returns to US market in Octo...