The Federal Open Market Committee has released a hawkish set of minutes of the June policy meeting.

Markets have nearly fully priced in another 75 basis points rate hike in July with which the minutes align with. Investors are paying closer attention to discussions around the September rate decision, however.

• See 50 or 75bps at the next meeting, July, as likely.
• Even more restrictive policy is possible in time.
• Fed's George was the only official not to back 75 basis points in June.
• 'Many' participants judged there was a 'significant risk' higher inflation could become entrenched if the public questions Fed's resolve.
• Participants 'concurred' that high inflation warranted 'restrictive' interest rates, with the possibility of a 'more restrictive stance' if inflation persists.
• The Fed expects inflation to remain above 2% for some time.

The US dollar is little changed after the minutes, trading at 107.00 and 0.48% higher on the day.

(5-min chart, DXY)

About the minutes

FOMC stands for The Federal Open Market Committee organizes 8 meetings in a year and reviews economic and financial conditions, determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. FOMC Minutes are released by the Board of Governors of the Federal Reserve and are a clear guide to the future US interest rate policy.