US Fed minutes show bank is unlikely to hike rates in October

The US Federal Reserve’s September meeting minutes, released on Wednesday, have dampened expectations for a rate hike at their upcoming October meeting. While the central bank did vote to raise interest rates last month, policymakers were divided on the reasoning behind the decision, with some aiming to combat demand-driven inflation and others targeting energy and AI-driven price shocks.

The recent cooler-than-expected jobs report, coupled with rising bond yields, has supported the argument for a rate pause. According to a former Philadelphia Fed president, who spoke to The Wall Street Journal, "The long end of the yield curve has already gone up, and that's the end that matters to the economy." The market's odds of a rate increase at the October meeting have consequently decreased, with expectations still standing for a December hike.

Brief written by urgent.news from Semafor's own syndicated text. Machine-written — may contain errors; check the original before relying on it.