May 24, 2017
Minutes from the Fed show members showing patience at their meeting earlier this month, willing to wait for a bounce back in inflation and consumer spending before raising rates again. The minutes also include the first framework for tapering: a series of gradually increasing limits, reset every three months, on how much of their $4.5 trillion balance sheet is run off.
Another weak report out of housing, this time sales of existing homes, points to a slow spring start for the sector. Early data on the second quarter, including housing and consumer spending, are not pointing to a strong bounce from what was a very weak first quarter.
The bond market is taking the minutes as slightly dovish with the 2-year yield down 3 basis points to 1.28 percent. Oil held little changed over $51 despite another draw in weekly inventories.