The Federal Reserve released full minutes from its April 28-29 FOMC meeting, confirming that a majority of officials believe rate hikes remain on the table if inflation persists. Four voting members dissented on policy language, with three preferring a more explicitly two-sided characterization of the rate outlook. The backdrop includes inflation pressure tied to the Iran war and the impending transition to incoming Chair Kevin Warsh.
For Armada's traditional repo desk, a rate hike bias materially shifts the SOFR forward curve, affecting floating-rate repo pricing, collateral valuations on longer-duration Treasuries, and margin requirements with hedge fund and asset manager counterparties. Any abrupt repricing could trigger variation margin calls and compress dealer balance sheet capacity.