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Tuesday, July 13, 2010

Fed Minutes Preview

by Calculated Risk on 7/13/2010 10:29:00 PM

Usually the Fed minutes are pretty boring, but the minutes for the two day meeting held on June 22nd and 23rd, to be released on Wednesday, might be a little more interesting.

This release will include a revised forecast. Look for the Fed to revise down estimates for GDP and for inflation. And revise up estimates for unemployment.

The Fed April forecast for 2010 (most recent) was:

  • Change in real GDP: 3.2% to 3.7% (probably under 3.0% in first half, and GDP growth will probably slow in the 2nd half)

  • Unemployment rate: 9.1% to 9.5% (Unemployment averaged 9.7% in the first half, and will probably remain elevated)

  • PCE inflation: 1.2% to 1.5% (PCE inflation increased at a 0.7% annualized rate over the first 5 months - and appears to be dropping).

    Also the Fed might have discussed possible additional easing measures at the June meeting, and if so, it will be interesting to see the options discussed.

    Jon Hilsenrath at the WSJ has a preview: Fed Sees Slower Growth

    From Steve Matthews and Carol Massar at Bloomberg: Blinder Cuts U.S. Forecast, Says Fed Must Plan for More Easing (ht jb)