Rates as of 0500 GMT

Market Recap

From transitory to expeditiously  In the minutes of the May meeting of the Federal Open Market Committee FOMC, the ratesetting body of the US central banks, the new buzzword is expeditiously. So we got comments like participants agreed that the Committee should expeditiously move the stance of monetary policy toward a neutral posture, through both increases in the target range for the federal funds rate and reductions in the size of the Federal Reserves balance sheet and Many participants judged that expediting the removal of policy accommodation would leave the Committee well positioned later this year to assess the effects of policy firming and the extent to which economic developments warranted policy adjustments. Concretely, what does this mean? Answer Most participants judged that 50 basis point increases in the target range would likely be appropriate at the next couple of meetings. This is what they mean by expeditiously 50 bps hikes rather than 25 bps. And while they want to move policy toward a neutral posture, participants also noted that a restrictive stance of policy may well become appropriate depending on the outlook for the economy.

In short, the minutes confirmed that were likely to see 50 bps hikes at the June and July meetings, after which theyll pause to reassess the situation and decide what to do next at the September meeting. This was the prevailing narrative before the minutes came out and so didnt really…