The market is just going to have to get used to the notion that the interest rate hike cycle is coming. The good news is that the rate hikes are not coming in June, at least that is what the wording from the minutes of the last FOMC meeting is indicating. One consideration that traders and investors should consider is that the word “patient” was not used in these minutes and that these are the minutes from the April 28 – 29 FOMC meeting.

Another consideration, which 24/7 Wall St. had addressed in detail, is that bankers, investors, consumers, and business owners simply do not need to worry excessively about rising interest rates. The market has seen waves of overreactions to getting ready for higher interest rates.

The big news is that a June rate hike is doubtful, even if it wasn’t ruled out entirely. A few officials thought that the data would justify raising Fed Funds by the June meeting, while many Fed officials thought that a June rate hike was now unlikely. Most of those surveyed expected  that the economy and jobs will improve after a weak first quarter. Risks are still there on the international outlook, including China’s slowdown and a potential Greek exit from the euro. in short, the Fed still sees downside risks from foreign economic and financial developments which increased some uncertainty around the Fed’s outlook.

The Fed staff also revised its medium-term GDP growth modestly, with the note that much of the weakness was due to transitory factors and due to statistical noise. The note was given that careful policy communication could help to dampen market volatility. A key notion here was that some officials have worried about a sharp rise in term premiums once the Fed actually starts raising interest rates.

The FOMC minutes showed that the exit tool testing has created conditions for a smooth policy normalization. This is a buzzword-phrase for the notion that they think they can raise rates slowly without wrecking the work of recent years.

Wednesday’s minutes showed that the Fed staff would provide more frequent updates on financial markets after interest rates begin to rise.

Fed officials were shown to have discussed increasing the spread between the prime rate and the top of the Fed Funds range. Several Fed officials favored maintaining the current spread for now.

Richmond Fed’s Lacker dissented on both currency votes. That was after the standing currency arrangements are taken annually, and after the Fed renewed its reciprocal currency arrangements and swaps with foreign central banks.

ALSO READ: Why The Fed Cannot Panic on Rate Hikes

After almost 30 minutes of trading since the Fed’s minutes from the April meeting were released, the S&P 500 was up 2 points and the DJIA was up about 10 points. Still, the NASDAQ was up over 10 points. The yield on the 10-year Treasury was still 2.25% and the yield on the 30-year Treasury had a yield of 3.06%.

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