The Fed Is Searching for a New Framework. New Minutes Show It Doesn’t Have One Yet.

by Neil Irwin
New York Times

The quandary facing the Federal Reserve this summer is the same as it was back in the spring, and winter, and last fall: By traditional guideposts like the unemployment rate, it looks as if it is time for the Fed to be raising interest rates. Yet the global economy seems to be locked in a low-growth, low-inflation world in which raising interest rates is at best unnecessary and at worst dangerous.

That tension was on display Wednesday in the minutes of the Fed’s last policy meeting, which raised the possibility of rate increases as early as September.

As is the Fed’s standard practice, the description of the meeting was stripped of names and summarized in bloodless language.

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