The Federal Reserve isn’t as mysterious as it’s made out to be. It’s not hiding coded messages in its communications. It’s not using obscure metaphors that seem to say one thing but actually mean the opposite. There’s no secret chord that only the truly devout can hear. When Fed policy makers said, as they did in the summary minutes of their July 26-27 meeting, that they are all “highly attentive to inflation risks,” they meant it. When they said that “there was little evidence to date that inflation pressures were subsiding,” they meant it. When they said that inflation “would likely stay uncomfortably high for some time,” they meant it.
Read more coverage: Federal Reserve officials back moving interest rates higher to slow the economy, minutes showResolutely hawkish And above all, they meant it when they unanimously agreed that the risk of persistently high inflation made it necessary to raise the federal funds
target range by 0.75 percentage points to 2.25% to 2.50% last month, and that they anticipated that “ongoing increases in the target range would be appropriate.” The Fed remains resolutely hawkish (biased toward higher interest rates). There was no hidden, secret dovish message in the July 26-27 minutes. But some people found one any way. As MarketWatch’s Isabel Wang reported Thursday, many participants in the stock market misread the minutes initially on Wednesday, thinking that the Fed was secretly getting cold feet and was hinting at a “dovish pivot.” But by Thur …