“All participants pointed to ongoing trade disagreements and proposed trade measures as an important source of uncertainty and risk,” the minutes reported. A prolonged trade dispute, officials said, would likely bring “adverse effects on business sentiment, investment spending and employment. Moreover, wide-ranging tariff increases would also reduce the purchasing power of U.S. households,” while disrupting supply chains and reducing productivity. There was no sign in the minutes that Fed officials were worried home values were in a “bubble,” similar to the period before the financial crisis. Others said the pace of increases suggests there is still more room for unemployment to fall before it begins to push up wages more significantly.

Source: New York Times August 22, 2018 18:21 UTC