The US Federal Reserve published the minutes of the June meeting

The minutes of the meeting that occurred on June 13-14 were announced by the Fed.

Anticipating this event, the dollar index saw an increase in growth and reached three-day highs of 103.4.

The protocols recommend that monetary policy be further tightened, which will bolster the US dollar.

GDP growth in the second quarter was relatively slow. The minutes noted that labor market conditions remain very tight, with wages increasing significantly and unemployment still near its historical low.

Between meetings, the cost of borrowing for businesses, households, and municipalities in domestic credit markets rose significantly. Banks' capacity to finance loans to businesses and individuals has stabilized, and banking stress has decreased significantly, leading to improved conditions in the banking sector.

Members of the Federal Open Market Committee (FOMC) concurred that inflation was too high and observed that the data, including the Consumer Price Index (CPI) for May, showed that the decrease in inflation was slower than what they had anticipated.

Tighter credit conditions, such as increased interest rates for households and businesses, have had a negative impact on the economy, potentially leading to decreased economic activity, employment, and inflation. However, the full extent of this effect is still unknown.

Members of the Federal Open Market Committee (FOMC) acknowledged a great deal of uncertainty regarding the total effect on the economy of both the monetary tightening that has already been implemented and the potential for further tightening of credit conditions due to recent changes in the banking industry.

The minutes state that by maintaining rates at the same level, it will provide more opportunity to evaluate how the economy is progressing in achieving the Federal Reserve's objectives of maximum employment and price stability.

The minutes of the FOMC revealed that there were disagreements within the Fed, as some members were in favor of increasing rates.

All participants agreed that keeping a tight monetary policy would be necessary to reach the 2% inflation target when discussing the policy outlook.

In their economic forecasts, nearly all members of the Federal Open Market Committee (FOMC) deemed it suitable to raise rates again in 2023.