US: Light calendar with FOMC Minutes main feature - BBH

Research Team at BBH, suggests that the calendar is light for the US today and the main feature is the FOMC minutes from the April meeting.

Key Quotes

“The minutes pick up a range of views. The FOMC statement is one view, as nuanced as it may be. Given the discussions in March, with some regional presidents suggesting the possibility of an April hike (and Yellen at the NY Economic Club saying no), the minutes are likely to be more hawkish than the statement. This also seems obvious from recent comments from a few Fed presidents.

There was one dissent, Kansas Fed's George. We suspect, but cannot prove, that there is an agreement about dissents. George's dissent may represent others' views. One need not be Tyler Durden to appreciate that the Fed's public persona is finely crafted, with much thought and consideration.

Yesterday, Lockhart, Williams, and Kaplan all sounded hawkish. Lockhart said 2-3 rate hikes this year are possible, while Williams said that he views the June FOMC meeting as live. Indeed, Lockhart said he doesn’t rule out hiking ahead of the Brexit vote. Lastly, Kaplan said that a rate hike may be warranted in the no-so-distant future. Yet we must note that none of the three are voting members in 2016.

We continue believe that investors are best advised to hear what the regional presidents say, but listen to the leadership of Yellen, Fischer, and Dudley. Not to put too fine of a point on it, but a clearer sense of the Fed's thinking will be likely found in Fischer and Dudley's speeches tomorrow than the minutes today.”