The minutes from the recent Federal Open Market Committee were not as dovish as some had expected and this seems to have encouraged some profit-taking on short-dollar positions. The Fed was widely expected to cut inflation and growth forecasts, but the downgrades were not as severe as anticipated. This year's GDP forecast was trimmed to 3.0% to 3.5% from 3.2% to 3.7%. It's still a three-handle, which will seem downright optimistic to many. Next year's growth forecast was cut to 3.5% to 4% from 3.4% to 4.5%. This year's inflation forecast was cut to 1.0% to 1.1% from 1.2% to 1.5% in April. The unemployment forecast was little changed at 9.2% to 9.5% from 9.1% to 9.5% in April. While there was some talk of action if needed, the discussion seemed vague with no specific actions proposed and the bar, as we suggested, seems a bit high in so far as it would require an "appreciably worsening" of the outlook. Bottom line is that the market is responding as if the Fed is unlikely to respond to the modest weakening of the economy. It is not hawkish enough to reverse the negative sentiment toward the dollar and it is not dovish enough to heighten expectations for a resumption of credit easing.