Why are traders watching the FOMC minutes for US interest rate clues?

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Traders are watching the FOMC minutes because they may reveal the direction of US interest rates, especially after the June meeting lacked forward-looking guidance.
Traders, investors, and economists are likely to focus on the US Federal Open Market Committee (FOMC) minutes because they want clues on where US interest rates are headed. This interest is heightened by the fact that the June FOMC meeting had an absence of forward-looking guidance, making the minutes a potentially more informative source for market direction.
The FOMC minutes are viewed as a direct signal on US interest-rate direction
In the run-up to next week’s trading, the market’s attention is expected to centre on the FOMC minutes. The reason is that these minutes are used to look for clues on the direction of US interest rates, which can influence how the US dollar moves versus the ringgit.
The June FOMC meeting had no forward-looking guidance, increasing the value of the minutes
The minutes are considered especially important because the June FOMC meeting did not provide forward-looking guidance. With that gap, the minutes may be scrutinised more closely for additional, direction-setting information that the June meeting itself did not offer.
The timing lines up with BNM’s Monetary Policy Committee meeting on July 9
Both the FOMC minutes and Bank Negara Malaysia’s (BNM) Monetary Policy Committee (MPC) meeting are set for Thursday, July 9. With both major policy-related events occurring the same day, traders are expected to look at the US policy signal from the FOMC minutes alongside the Malaysian signal from BNM’s MPC.
Market positioning also reflects potential ringgit moves around RM4.05
The ringgit is expected to trade between RM4.05 and RM4.07 against the US dollar next week, and the US dollar/ringgit pair may attempt to break the RM4.05 level. That outlook adds urgency to watching the FOMC minutes for US rate direction, since it can affect short-term currency movement.

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Why are traders watching the FOMC minutes for US interest rate clues?

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