The United States (US) Federal Reserve (Fed) will release the Minutes of the June 16-17 Federal Open Market Committee (FOMC) meeting on Wednesday at 18:00 GMT. The Minutes should shed more light on the Fed’s hawkish hold delivered at Kevin Warsh’s first meeting as Fed Chair. Even so, doubts remain about how much the minutes will reveal, given Warsh’s refusal to provide forward guidance.
The US central bank left the Fed Funds rate unchanged in the 3.50%-3.75% range, as widely expected, although the statement’s language showed a hawkish tilt that surprised markets and provided some support to the US Dollar (USD).
The committee approved the decision unanimously, putting an end to market speculation about the divergences within the governing council. Beyond that, the statement highlighted resilient activity and above-target inflation, adding to the case for interest rate hikes in the near term.
Kevin Warsh and his unexpected hawkish edge
The Fed met expectations in June and left its benchmark interest rate on hold for the sixth consecutive time, with the new chairman’s hand evident in the reduced monetary policy statement. The main takeaway of June’s meeting, however, was Kevin Warsh’s willingness to remove forward guidance, in clear contrast to his predecessor, Jerome Powell’s style, to allow the central bank further flexibility in setting monetary policy.
Warsh, however, was swift to tackle investors’ concerns about the central bank’s independence, showing an “unambiguous” commitment to deliver price stability, which the market took as a hawkish signal.
The bank’s statement also confirmed Warsh’s plans to implement radical changes in key areas of the central bank, including communication, data sources, and the framework of the central bank’s inflation studies, which might also alter the bank’s monetary policy stance in the medium term.
As an immediate consequence of the new house style, the bank is expected to deliver a slimmer, less informative version of the Minutes with no clear hints about the bank’s rate path beyond the economic and inflation outlook.
With this in mind, investors will cautiously analyse the Minutes against the framework of last week’s disappointing Nonfarm Payrolls (NFP) report. June’s Payrolls showed a sharp slowdown in net employment creation, at 57K against expectations of a 110K increase, following three months of strong data, which prompted investors to push back hopes of Fed rate hikes.
Beyond that, concerns about inflation have eased since last month’s meeting. The latest US inflation figures remain well above the 2% target, but the easing tensions in the Middle East have brought Crude Oil prices back to pre-war levels. This is likely to cool price pressures over the coming months, and might grant Warsh with valuable leeway to postpone rate hikes.
When will FOMC Minutes be released and how could they affect the US Dollar?
The FOMC will release the Minutes of the June 16-17 policy meeting at 18:00 GMT on Wednesday.
Investors’ bets on Fed rate hikes have receded from the highs witnessed before last week’s NFP report, but money markets are still pricing at least a 25-basis-point rate hike over the next six months, which keeps the US Dollar buoyed.
The CME Group’s FedWatch tool still shows a 58% chance of a rate hike in September and nearly an 80% chance that the bank will tighten its monetary policy before the year-end. In this context, a clear message from the bank to contain inflationary pressures might reassure Fed tightening bets and provide a fresh boost to the US Dollar.
Downside risks from the US Dollar, in this case, would come from comments that play down the risk of second-round effects on inflation and link current higher prices to the energy shock.
USD moves, in any case, are likely to be limited, as recent developments in the Middle East and last week’s labour figures have altered the scenario, and investors are likely to await further US economic releases to better assess the Fed’s rate hike calendar.
The US Dollar Index (DXY) has been wavering on both sides of the 101.00 level so far this week, trading within a corrective channel from last week’s highs at the 101.80 area. Momentum indicators highlight a mixed bias, with the Relative Strength Index (14) just below 50 and the Moving Average Convergence Divergence (MACD) near zero hinting at a lack of clear bias, although the broader trend remains bullish.
Immediate resistance emerges at the mid-range of the 101.00s, which held bulls in early July, closing their path towards the 2026 peak of 101.80. On the downside, bears would have to breach the area between the 38.2% Fibonacci retracement of June’s rally and the July 2 low, in the 100.50-100-60 area, to confirm a deeper correction, aiming for the June 11 high around 100.30. Further down, the 78.6% Fibonacci retracement meets the June 15 low, just below 99.40.
(The technical analysis of this story was written with the help of an AI tool.)
Central banks FAQs
Central Banks have a key mandate which is making sure that there is price stability in a country or region. Economies are constantly facing inflation or deflation when prices for certain goods and services are fluctuating. Constant rising prices for the same goods means inflation, constant lowered prices for the same goods means deflation. It is the task of the central bank to keep the demand in line by tweaking its policy rate. For the biggest central banks like the US Federal Reserve (Fed), the European Central Bank (ECB) or the Bank of England (BoE), the mandate is to keep inflation close to 2%.
A central bank has one important tool at its disposal to get inflation higher or lower, and that is by tweaking its benchmark policy rate, commonly known as interest rate. On pre-communicated moments, the central bank will issue a statement with its policy rate and provide additional reasoning on why it is either remaining or changing (cutting or hiking) it. Local banks will adjust their savings and lending rates accordingly, which in turn will make it either harder or easier for people to earn on their savings or for companies to take out loans and make investments in their businesses. When the central bank hikes interest rates substantially, this is called monetary tightening. When it is cutting its benchmark rate, it is called monetary easing.
A central bank is often politically independent. Members of the central bank policy board are passing through a series of panels and hearings before being appointed to a policy board seat. Each member in that board often has a certain conviction on how the central bank should control inflation and the subsequent monetary policy. Members that want a very loose monetary policy, with low rates and cheap lending, to boost the economy substantially while being content to see inflation slightly above 2%, are called ‘doves’. Members that rather want to see higher rates to reward savings and want to keep a lit on inflation at all time are called ‘hawks’ and will not rest until inflation is at or just below 2%.
Normally, there is a chairman or president who leads each meeting, needs to create a consensus between the hawks or doves and has his or her final say when it would come down to a vote split to avoid a 50-50 tie on whether the current policy should be adjusted. The chairman will deliver speeches which often can be followed live, where the current monetary stance and outlook is being communicated. A central bank will try to push forward its monetary policy without triggering violent swings in rates, equities, or its currency. All members of the central bank will channel their stance toward the markets in advance of a policy meeting event. A few days before a policy meeting takes place until the new policy has been communicated, members are forbidden to talk publicly. This is called the blackout period.
Economic Indicator
Fed Interest Rate Decision
The Federal Reserve (Fed) deliberates on monetary policy and makes a decision on interest rates at eight pre-scheduled meetings per year. It has two mandates: to keep inflation at 2%, and to maintain full employment. Its main tool for achieving this is by setting interest rates – both at which it lends to banks and banks lend to each other. If it decides to hike rates, the US Dollar (USD) tends to strengthen as it attracts more foreign capital inflows. If it cuts rates, it tends to weaken the USD as capital drains out to countries offering higher returns. If rates are left unchanged, attention turns to the tone of the Federal Open Market Committee (FOMC) statement, and whether it is hawkish (expectant of higher future interest rates), or dovish (expectant of lower future rates).
Last release:
Wed Jun 17, 2026 18:00
Frequency:
Irregular
Actual:
3.75%
Consensus:
3.75%
Previous:
3.75%
Source:
Federal Reserve
