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The Federal Reserve releases its minutes from the May meeting. At the time, Yellen and her relatively  sanguine about the economic downturn and saw it as transitory. What can we expect from the minutes?

Here is their view, courtesy of eFXnews:

The focus of USD investors will be on next week’s FOMC minutes from the May 2-3 meeting.

In that regard,  Barclays Research expects the minutes to show that most FOMC members viewed the slowdown in Q1 activity as transitory, and to downplay soft incoming data against continued improvement in labor marker data.

“In addition, they should show that committee members viewed the weak February inflation data as driven by one-off factors. Regarding the outlook for policy, the minutes will likely conclude that a further normalization of policy remains appropriate.

That said, while we believe the minutes will reveal further discussion, we do not foresee the committee reaching consensus on how securities will roll off the balance sheet, among other items,” Barclays adds.

Barclays maintains its view that the Federal Reserve will tighten policy in June.

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