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While the December Fed liftoff is already old news, the transcript of their actual meeting could give forex market watchers more clues on when the next rate hike might take place.

If you’re not in the mood to read the entire 21-page text of the FOMC minutes, here’s a summary of the biggest takeaways:

1. Liftoff decision was a “close call” for some

Perhaps what’s a bit surprising about last month’s Fed decision was that some policymakers weren’t feeling all that confident about tightening monetary policy just yet.

“Some members emphasized the importance of confirming that inflation would rise as projected and of maintaining the credibility of the committee’s inflation objective,” the minutes indicated, although the majority of the members agreed that the conditions for policy normalization had been met.

2. Labor market improvements as a green light for policy normalization

Still, the consistent developments on the employment front were enough to push policymakers to proceed with a 0.25% rate hike.

In particular, Fed officials acknowledged that these labor market gains might actually be enough to accelerate wage growth, which might then spill over to stronger inflationary prospects.

With that, upcoming NFP releases are still likely to have a strong impact on Fed tightening expectations and Greenback’s forex price action. Better swing by my Forex Trading Guide for this week’s NFP release then!

3. “Significant concern” over low inflation

As in their previous huddles, weak inflation remains a huge concern for most FOMC members, and it doesn’t help that commodity prices have been tumbling again lately.

Some policymakers reiterated that there are still considerable risks to their inflation forecasts, even though they remain hopeful that the 2% target can be achieved in the medium term.

“Many concluded that longer-run inflation expectations remained reasonably stable,” the minutes showed. “However, some expressed concerns that inflation expectations may have already moved lower.”

4. External risks shouldn’t be much of a problem

When it comes to economic challenges stemming from the slowdown in other nations, Fed officials don’t appear too bothered at the moment.

“Participants generally saw the downside risks to US economic activity from global economic and financial developments, although still material, as having diminished since late summer,” the FOMC minutes indicated.

Of course, this outlook might still be adjusted in their next FOMC meetings, especially since China’s stock market nightmares are recurring and emerging markets are also starting to feel the pain these days.

5. Tightening cycle would be a gradual one

At the end of the day, Fed officials reiterated that the tightening cycle would proceed gradually, which suggests that they might take a breather this month and probably wait until the end of the quarter before considering another hike.

“The appropriate path for the federal funds rate would depend on the economic outlook as informed by incoming data,” the minutes concluded. “Members stressed the potential need to accelerate or slow the pace of normalization as the economic outlook evolved.”

In a nutshell, the Fed appears confident that the U.S. economy can carry on with its ongoing recovery and that it’s on a positive track.

Only time will tell if the recent financial market developments and commodity price declines might cloud this upbeat forecast, but so far it looks like the Greenback is on pretty strong forex footing.