The Federal Open Market Committee (FOMC) minutes released Wednesday confirmed a cautious stance among policymakers, with most members agreeing that the current federal funds rate target range of 5.25–5.50% is appropriate.
Key excerpts from the minutes indicated:
**Rate outlook:** Officials want to see "several months" of lower inflation readings before considering rate reductions. Some members flagged risks of cutting too soon and reigniting price pressures.
**Labour market:** The job market remains resilient. April's NFP print of 175,000 was seen as a sign of gradual cooling, which officials welcomed.
**Market reaction:**
- USD (DXY) gained 0.3% following the release
- Gold (XAU/USD) pulled back to $2,375 from $2,392
- EUR/USD slipped to 1.0812
The next critical data points are the June CPI report (July 11) and the July FOMC meeting. Markets are currently pricing a 65% probability of the first cut in September 2025.
For UAE and GCC traders, USD movements directly impact AED-pegged accounts and commodity prices.
*Risk Warning: This is market analysis for informational purposes only and does not constitute financial advice.*