Federal Reserve released minutes from the latest FOMC meeting at 7 pm GMT. Officials at that meeting voted to keep benchmark short-term borrowing rates anchored near zero. Here are key takeaways from the document:
- Members said the current pace of purchases was helping keep financial conditions accommodative, they noted that changes could be enacted if necessary.
- Officials also expressed concern about the pace of the economic recovery, noting that growth was still well off the pace before the pandemic began
- Some market participants expected the Committee to eventually lengthen the weighted average maturity of the Federal Reserve's purchases of Treasury securities.
- While participants judged that immediate adjustments to the pace and composition of asset purchases were not necessary, they recognized that circumstances could shift to warrant such adjustments.
- Committee is expected to continue its net asset purchases at the current pace through next year and at a reduced pace in subsequent years
The publication did not bring much surprise and market reaction is rather muted. There was a lot of talk in the minutes about changes to QE. Committee members generally see the current pace of QE as effective and believe there is no need to change the pace and structure of asset purchases any time soon. We will get more hints on the further shape of the policy at the December meeting.
