The minutes from the July 28 to July 29 Federal Open Market Committee’s meeting are signaling low inflation and some weakness in the world, but the trajectory for a rate hike is still in place. At issue is that a September expectation is now up for even more debate. The conditions for a rate hike are approaching. These broke ahead of the traditional embargo on Wednesday.

Many risks still remain to the global economy, but the Fed presidents discussed how to prepare further for the process of normalization of monetary policy. While the minutes signal that a rate hike is likely, the timing, meaning September or not, remains up for debate.

The FULL MINUTES can be accessed, but here are several bullet points:

• Officials generally agreed that additional information was needed before raising rates. One member was ready to raise, but was willing to wait. Fed officials saw a nearly balanced set of risks on the outlook for the economic and labor market.
• The effects of financial stress have so far been limited around Greece and China. Still, that was before China devalued.
• The staff saw neither monetary policy nor fiscal policy being well-positioned to help the economy withstand adverse shocks. Risks to GDP and the inflation forecasts were also said to be tilted toward the downside.
• Net exports are expected to subtract from GDP due to the strong dollar.
• Consumer spending is expected to rise moderately.
• Officials mostly think that downward pressure on inflation from energy and the dollar would abate.

Again, there are many issues brought up in the minutes. There always are, and there is always a debate over what was really meant.

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