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Golden Ten Data reported on May 21 that the minutes from the Federal Reserve meeting indicate staff members view the outlook for economic activity as slightly stronger than the forecast from the March meeting. It is projected that the real GDP growth rate will be slightly higher than the potential growth rate over the next few years. The unemployment rate is expected to be close to the staff's estimate of its long-term level over this year and next year, then slightly below that level around 2028. Staff members’ inflation forecast for this year is higher than their projection at the March meeting, due to the latest data, higher energy prices, and other impacts from Middle East conflicts expected to drive up consumer price inflation. Inflation is expected to start moderating after the first half of this year as the influence of conflict-related factors on the economy gradually fades and the effect of higher tariffs on inflation diminishes; by the end of next year, inflation is projected to be near 2%. Overall, the risks to employment and real GDP growth forecasts are tilted to the downside, while inflation forecast risks are skewed to the upside: over the past five years, inflation has consistently been well above 2%, Middle East conflicts could further increase inflation, and there are emerging pricing pressures in some categories unrelated to tariffs or energy prices. Therefore, staff members believe that the prospect of more persistent inflation than expected is a risk that warrants close attention.

ChainCatcher News, according to Golden Ten Data, the minutes of the Federal Reserve meeting show that market participants expect little change in the target range of the federal funds rate this year. Option prices imply about a 30% chance of a rate hike in the first quarter of 2027. Surveys indicate there will be two 25-basis-point rate cuts in the coming year, with the timing expected to be later than previously surveyed, specifically in the third or fourth quarter of 2026 and the first quarter of 2027.

Golden Ten Data reported on May 21 that the minutes of the Federal Reserve's April meeting indicate that officials have updated their assessment of the stability of the US financial system. Overall, the financial vulnerability of the US financial system remains "noteworthy." Asset valuation pressures are at a high level, and housing valuation metrics are approaching historical highs. Vulnerabilities related to non-financial corporate and household debt were assessed as "moderate." Household balance sheets remain strong, with significant housing net worth. Although overall corporate debt growth has been moderate in recent years, private credit is expanding rapidly. Some private credit instruments experienced net capital outflows in the first quarter, partly due to market concerns that AI could disrupt the business models of certain industries—especially the software sector—thereby impacting credit quality. Vulnerabilities related to leverage in the financial sector were assessed as "noteworthy." Hedge fund leverage remains high, especially in leveraged transactions in the US Treasury market. Leverage ratios for life insurance companies have also stayed elevated. By contrast, banks’ regulatory capital ratios remain high compared to historical levels. However, banks’ capital ratios adjusted for market value declined in the first quarter and remain below pre-2022 levels, though still significantly higher than troughs seen several years ago. The duration of bank assets has fallen back to pre-pandemic levels, indicating a reduced interest-rate risk exposure compared to recent years. Vulnerabilities related to financing risk were assessed as "moderate."