Examples of Information That Can Be Learned By Reading FOMC Meeting Minutes

By | November 16, 2016

As part of the Federal Reserve Board, the Federal Open Market Committee is tasked with deciding when to modify the country’s monetary policy. The group consists of 12 members who meet at least eight times each year. People who are interested in learning what goes on at an FOMC meeting can read the meeting’s minutes when they are posted online later. The minutes can be complex and somewhat to difficult to understand when readers are not familiar with economics, but reading them after each meeting can become a fascinating learning process.

It may be surprising to see how many meeting attendees are present. Dozens of individuals in addition to the committee itself attend. Included are executives from various Federal Reserve banks, representatives from the Division of Monetary Affairs, a handful of professional economists and others.

The committee reviews recent financial developments both at home and abroad. The members discuss the current economic situation in the United States, including aspects such as employment, inflation, industrial production, consumer spending, housing prices and consumer sentiment. They consider international factors such as trade and the financial activities of various countries. In addition, the committee discusses recent aspects of stock market activity and other financial markets, such as Treasury securities.

Long-term investors, active traders and the general public may be most interested in the FOMC’s outlook on the current economic situation and what they see in the near future. That part of the minutes may indicate what to expect in the stock market, prices in real estate and consumer goods, employment rates and other factors.

Readers of the minutes can even get a sense of whether gas prices will go up or not in the next few months. Prices for crude oil can be connected with other financial occurrences in the country. For instance, although lower gas prices are welcomed by consumers and businesses that rely on trucking, the lower prices also can mean decreasing economic health in parts of the country that rely on oil production for local salaries. That has a ripple effect on real estate prices in the area and the local housing market.

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