On Wednesday, the 21st of August 2019, at August’s FOMC minutes, Federal Reserve policymakers seemed to be deeply divided on whether they should slash interest rate again on September after axing borrowing cost on July for the first time since the era of great financial depression in 2008, however the policymakers appeared to be united not to follow up a course of an aggressive rate-cut cycle after hiking interest rates four times last year, sending a message to US President Donald Trump which would unlikely to be well-received, as Trump had long been yearning for a full-point basis interest rate cut.
Aside from that, August’s FOMC minutes showed more opposition from Fed policymakers to lower borrowing cost by a quarter percentage point than anticipated, while two of the policymakers with voting rights had favored a deeper rate cut of 50-basis point in order to lift inflation towards Fed’s target range of 2 percent and to alleviate impacts of growing global trade unrests.
Nonetheless, a majority of Fed policymakers favored no change at all in the interest rate. Besides, a two-day meet of Fed policymakers in August had also signaled that Fed was not rattled at all by US President Donald Trump’s repeated urge of a broader interest rate-cut ahead of a Jackson Hole speech by Fed Chair Jerome Powell scheduled to take place by next Friday (August 23rd), while a vice president for fixed income trading at D.A Davidson in Seattle, Mary Ann Hurley said, “I think the thing that surprised me was how divided they were.
We’re really in uncharted territory. They are really concerned about doing or not doing the right thing. ” Concomitantly, adding that the Fed would be guided by economic data, instead external pressures and geo-political unrests, August’s FOMC minutes said, “Participants generally favored an approach in which policy would be guided by incoming information ... and that avoided any appearance of following a preset course. ”