By Robert Eisenbeis, Ph.D.
In advance of the release of the FOMC's May minutes, speculation in the press and by financial market participants was that the Committee might cut the Federal Funds target rate. The main line of conjecture centered on how long the FOMC could continue to miss its inflation target on the downside before a rate cut was warranted.
Clearly, given the lowest unemployment rate in 50 years but with inflation still running persistently below target, current economic conditions present a policy dilemma for the FOMC that is reflected in the widely differing