NEW YORK (Reuters) – A “substantial majority” of policymakers at the Federal Reserve’s meeting early this month agreed it would “likely soon be appropriate” to slow the pace of interest rate hikes as debate broadened over the implications of the U.S. central bank’s rapid tightening of monetary policy, according to the minutes from the session.
MARKET REACTION:
STOCKS: U.S. stocks rose after the Fed minutes.BONDS: U.S. Treasury two-year, 10-year yields slipped.FOREX: The dollar extended losses versus the yen and euro.
COMMENTS:
MICHAEL JAMES, MANAGING DIRECTOR OF EQUITY TRADING AT WEDBUSH SECURITIES, LOS ANGELES
“Multiple Fed governors indicated a slowing in the pace of rate hikes, which is pretty much exactly what equity markets needed to hear. They didn’t say they’re going to be pausing. Merely the fact that they’re going to be slowing the pace confirms what the majority of people have been hoping to see. That’s why you’re seeing an equity spike initially. Obviously, we’ll see where things go in the next two hours.”
“What equity markets needed to see for the recent strength to continue was what we got from the minutes.”
(Compiled by the Global Finance & Markets Breaking News Team)
