Just-released minutes reveal a fractured Federal Reserve that could not agree on almost every point of monetary policy at last month’s Open Market Committee meeting.
MarketWatch reports that everything from the timing of raising interest rates, to what to tell the markets when unemployment hit the 6.5% mark, to how to manage reverse repos caused disagreement among Fed officials, never mind the “taper or not” question. In deference to the meeting being Ben Bernanke’s last, the committee rallied behind a “stay the course” message, with the understanding that the issues would be brought up again at the next meeting on March 18th. This pretty much ensures that Janet Yellen’s first meeting at the head of the table will have some fireworks. The question is, what will be the result that the public will see?
The re-affirmation of the taper policy led to a small drop in precious metals before starting an oscillation in an extremely tight band. Stocks also fell slightly before beginning a recovery, while the dollar saw some desperately needed support.