Minutes repeat QE benefits, cost concerns
The minutes from the January FOMC meeting again highlighted the split among Fed officials with regard to the future of QE3. We note that the discussion of the costs is concentrated among the hawks, who are mostly non-voters, whereas the majority of voting members have emphasized the benefits of QE3. The minutes revealed growing support for tapering the pace of purchases; we see this as a 2014 event. The minutes also noted a review of the Fed’s asset purchases is scheduled for the March meeting. Initial market reaction was relatively muted.
Read the full report here.