FOMC minutes: Downside risks justified cut, then hold

Potential downside risks from “global developments” persuaded most members of the Federal Open Market Committee to vote to cut the benchmark interest rate in October, and then to hold it. “A couple” of members who supported one last cut, to a range of 1.50% to 1.75%, termed it “a close call relative to the option of leaving the federal funds rate unchanged,” according to minutes of the meeting, released Wednesday.
“Many participants judged that an additional modest easing at this meeting was appropriate in light of persistent weakness in global growth and elevated uncertainty regarding trade developments,” the minutes said. “Nonetheless, these participants noted that incoming data had continued to suggest that the economy had proven resilient in the face of continued headwinds from global developments and that previous adjustments to monetary policy would continue to help sustain economic growth.”
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