A currency trader watches monitors near the screen showing the Korea Composite Stock Price Index and the foreign exchange rate between U.S. dollar and South Korean won, right, at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, May 23, 2024.
Indexes were close to flat early in the day, but slunk lower after the Federal Reserve released the minutes of its last policy meeting. They showedit “would likely take longer than previously thought” to get inflation fully under control following disappointingly high readings early this year. In the bond market, the yield on the 10-year Treasury rose to 4.42% from 4.41% late Tuesday. The two-year yield, which moves more closely with expectations for the Fed, rose a bit more. It climbed to 4.87% from 4.84%.
The Fed is trying to pull off a tightrope walk where it slows the economy just enough through high interest rates to get inflation under control but not so much that it causes a bad recession.