Mohamed A. El-Erian , Columnist

A Fed Divided Against Itself

The September FOMC minutes show why the decision against a rate hike was a "close call."

October 12, 2016 at 8:45 PM UTC

Mohamed A. El-Erian is a Bloomberg Opinion columnist. A former chief executive officer of Pimco, he is president of Queens’ College, Cambridge; chief economic adviser at Allianz SE; and chair of Gramercy Fund Management. He is author of “The Only Game in Town.”

Restive board.
Photographer: Andrew Harrer/Bloomberg

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The minutes of the September meeting of the Federal Reserve’s Open Market Committee released Wednesday explained why three Fed board members had dissented from the majority’s “close call” decision to keep rates unchanged. The highly anticipated transcript provides insights into internal and external developments, illustrating the “unusual uncertainty” that policy makers must contend with.

The transcript is an important reminder of how difficult it has become to maintain a high level of conviction about the correct policy in a time of such fluidity in the economic, financial, political and institutional environment.