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Don’t Read Too Much Into the Fed Minutes

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    Wells Fargo fixed-income strategist Brian Rehling gives his outlook for the Fed.

  • Duration 3:55
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Moments away now from window into the Fed minutes of the latest FOMC meeting.

-- be -- at the top of the hour and will be wondering if they're gonna shed new light on the prospect of more.

Stimulus.

Let's -- Wells Fargo chief fixed income strategist.

Bryan railing -- think you so much for joining us.

I as a leading into the break you know we've had some pretty good decent economic data points retail sales housing just today may -- inflation -- since the last meeting so how pertinent will the minutes maybe.

I think you make a great point.

Are you think about the last meeting August 1 it was really a lot of negative set -- out there.

And not very good economic news and and since then really economic news is turned around.

Are quite a bit and so I do I think it'd be careful reading too much into.

This Fed's -- these -- these minutes I do think that.

You know you may see a little bit more gloomy tone of the minutes then -- is really occurred here over the last few weeks and the Fed thinking may have changed a little bit over the last few weeks.

Are you I've sort of you know it's Brian do you believe that QE may been -- sell on the gender in December of what we would would that be what -- the Coles last to have most of based on.

Well I think we were heading towards QE3 in September clearly we -- headed down that path.

The economic data over the last few weeks is probably reversed the likelihood.

If -- QE3 in December probably gonna have to C again.

The employment numbers not continue to improve so we.

Start for -- employment numbers.

You know the nonfarm payrolls numbers below 200000.

Again for a couple months in a row.

You -- the general economic zone sentiment kind of -- -- You know could definitely be back on the agenda for December.

So events to keep a close eye on then by way of what the Fed may or may not -- I would imagine the -- -- payrolls number.

Coming out.

First week of September right and you -- the Jackson Hole meeting so give a cent from -- to what we need to be watching out for here.

Well I again that the Fed being a dual mandate bank.

Clearly focused on the unemployment picture so until we see a more sustained recovery there.

I think their keying in on that of course price stability the other key point so.

You know the inflation appears to be well under control giving them a little bit -- leeway so.

-- -- be on the watch -- ever tighter instructed just wanted to drill down on this point of the August payrolls -- some have suggested the make or break decision making.

Data point for QE.

I think clearly it it probably is for this September meeting.

You know although it -- a very negative report at this point.

To get its September action I think given some of the more positive data we've got both of the July number and more recently and some of the additional economic data.

Well right up until now -- the hasn't done a whole lot has it knew would talking about the job numbers -- duck.

The sad that reserve presenter -- -- yesterday basically saying hey he believes that the Central Bank is less willing now.

To ease monetary supplied but also -- questions whether.

It's been bad -- -- and then you know releasing more cheap money is not gonna do that much would you agree.

Well I do think that QE1 did have a a meaningful impact.

I just look where interest rates are today there are lower than even where they were during the height of the crisis so I I think there's been an impact.

I think it has been you know on the margin positive.

I do think that is each additional quantitative easing.

Is initiated has less.

The impact in the one before so I I think there there is strong case to be made that additional quantitative easing.

You know potentially.

Shows that the Fed doesn't have a lot of cards left the -- and I think they have to be careful about that.

Well Bryan railing Wells Fargo thank you so much for your insights.

Great.

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