According to the
minutes of the Federal Reserve meeting
held on April 24-25, 2012, "
several members indicated that additional monetary policy
accommodation could be necessary if the economic recovery lost
momentum or the downside risks to the forecast became great
The officials agreed that the recent economic activity suggested
that the economy has been expanding moderately and that the
economic outlook had not changed much since their March
However most participants felt that their projections for GDP
and unemployment were subject to a higher-than-normal level of
uncertainty now, mainly due to the situation in Europe and the
US fiscal environment.
Most participants expected that inflation would come down in
near future from its recent high levels as the effect of energy
prices waned and then it would stay close to the Fed's target rate
Some members felt that recent upward movement in housing sales
and starts was likely due to unusually warm winter weather and
while the home prices were stabilizing, they had not started to
rise. Most members expected that housing sector would recover
slowly over time.
As the economic projections released after the April meeting
showed, some members expected that the Fed would have to start
raising rates earlier than they had expected in January.
About half of the participants expected that the rates would
continue to be low at least through late 2014.
Members agreed that "
as the appropriate stance of monetary policy depends
importantly on the evolution of real activity and inflation over
time, their assessments of the appropriate future path of the
federal funds rate would change if economic conditions were to
evolve in an unexpected manner
The minutes also indicated that all FOMC meetings will now last
for two days, to allow additional time for discussion.
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