FOMC Minutes - 2025-02-18

The headline is that the FOMC sees the risks of inflation and unemployment as balanced. But the text makes clear they are more worried about inflation, and see the strong labor market as providing a free option on maintaining (what they think is) a restrictive policy. Relatively little hand-wringing about tariffs (we think they learned from the last meeting's embarrassing disclosures). But they let slip that they are expecting businesses to pass on tariff costs, but seeing the inflation effects as likely transitory. And they kicked off their review of their "monetary policy framework" with the assurance that the 2% inflation target is a sacred cow not to be disturbed.