The Fed whispers: The core of the Federal Reserve's differences lies in the inflation outlook, not the policy direction.

Wall Street Journal reporter Nick Timiraos stated that the minutes from the Federal Reserve's June meeting show that the main disagreements among officials stem from different assessments of future economic trends, rather than fundamental conflicts over raising or lowering interest rates. Two possible scenarios have emerged within the Federal Reserve: if inflation remains stubbornly high, almost all officials believe that higher rates need to be maintained, and policy may even need to be tightened further; however, if inflation quickly falls back to the target of 2%, almost all officials also believe that current rates can be maintained, and future rate cuts may even be possible. Timiraos emphasized that the phrase "quickly falling back to 2%" is crucial, as it allows the Federal Reserve to retain flexibility in adjusting its policies. Currently, officials are primarily concerned with whether inflation will continue to rebound or return to a downward trajectory. Timiraos concluded that the Federal Reserve's next steps will still depend on economic data, especially inflation performance. The market had been betting on rate cuts, but the latest minutes show that there is still significant uncertainty regarding the future of policy.