FOMC minutes are surprisingly dovish

•     FOMC minutes are surprisingly dovish

–    FOMC members emphasize risks to the outlook, such as stalling Eurozone economy, slow recovery in housing construction, and underutilization of labor

–    Minutes suggest no rush to raise rates, in contrast to higher forecast in “dot plot”

–    Fed funds expectations collapsed

•     FOMC also expressed concern about USD

–    Worried that further appreciation of USD could hurt US exports, exert downward pressure on inflation and make it harder to hit their inflation target

–    Contrast with Treasury Secretary Lew’s comments in favor of a strong dollar

•     No press conference after October FOMC meeting

–    Means we won’t get any full official clarification for some time

•     Conclusion:  dollar to remain volatile, may be further weakeness

•     Today:

–    Eurozone: German trade surplus expected to decline slightly

–    UK:  BoE MPC meets, no change likely, as usual should be a non-event

–    US: Initial jobless claims

–    Speakers:  ECB’s Draghi & FOMC’s Fisher speak in Washington; other ECB members and Fed officials speak as well