Split Decision at The Fed On Next Rate Move?

Here's something that USAToday pointed out in the minutes of the Fed meeting. Seems someone in the Fed wanted to make mention of the fact that at some point there should be room for a rate reduction in light of the move lower in the real estate sector. Here's what was quoted from the minutes:

"should emphasize that policy could be adjusted in either direction, depending on the evolution of the outlook for inflation and economic growth."

Now, I've been working on the premise that there's more of a chance of a move higher in rates, and that any moves lower haven't even been talked about yet. Seems that's not the case at all.

So where does this put my thesis? Well, the minutes describe the economic situation as being at risk of moderating due to the housing sector. If this sector improves, which we've seen some decent signs of, then this phrasing may never make it into the wording. The housing sector needs to be watched very closely if the Fed is going to specifically mention that as being its reason to lower rates. Over the next few months, the housing sector is going to be more closely scrutinized from the currency markets as well as the bond market.

However, the balanced portion of the minutes still weighs in on the risks of inflation as their central focus. I'm leaning towards inflation taming over the next year. This will take away the edge from the Fed's need to keep rates elevated.

Too many variables like this makes trading currencies a rollercoaster. Should be a fun year.