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Opinion
Jonathan Levin

The Fed Is in No Mood to Take a Break on Inflation

Minutes from the central bank’s May policy meeting offer no support for the market’s notion of a possible pause in interest rate increases.

Not taking it easy.

Not taking it easy.

Photographer: Al Drago/Bloomberg 

Investors who are thinking that the Federal Reserve is about to blink in its fight against inflation should start bracing for disappointment after the release of minutes from the central bank’s May policy meeting offered them little support.

Short-maturity bond yields have retreated since early May as markets weigh weakening economic and corporate data, which markets have interpreted as reason enough for the Fed to temper plans to raise interest rates. Atlanta Fed President Raphael Bostic bolstered this thesis Monday when he told reporters that a “a pause” in interest rate increases “might make sense” in September after a pair of them over the summer.