Your Evening Briefing: Fed Minutes Show More Hikes Likely on the Way

It seems that US Federal Reserve officials struck a weak agreement to pause interest-rate increases in June, and in doing so all but committed to hike them again later this month to keep fighting stubborn inflation. The minutes from the Fed’s June 13-14 meeting show that while almost all officials deemed it “appropriate or acceptable” to keep rates unchanged last month, some would have supported a quarter-point increase instead. “It was a little surprising given that the decision was sold as unanimous from Fed officials,” said Lindsey Piegza, chief economist at Stifel Nicolaus & Co. “There was a divergence of opinions, with some officials pretty clearly giving some reluctance for a one-month pause.” Officials supporting a hike in June cited tight labor markets and relatively few signs that inflation was slowing toward their 2% goal, according to the minutes. Some policymakers have expressed concern that core inflation, in particular, hasn’t budged much in the last six months. Whatever the disagreement among Fed officials, it’s fair to say the key takeaway is that more hikes coming. Here’s your markets wrap.

Ukrainian authorities are warning that Russia may be preparing for a false-flag operation, where Kremlin forces perpetrate an attack or similar provocation and then try to blame Kyiv. Like when, as Ukraine claims, Russia allegedly blew up a massive dam and then blamed Kyiv’s forces. In this case, the false-flag would involve blowing up Europe’s largest nuclear power plant.