The Federal Reserve intensified its drive to curb the worst inflation in 40 years by raising its benchmark short-term interest rate by an sizable half-percentage point
FILE - Federal Reserve Chairman Jerome Powell testifies before the Senate Banking Committee hearing, March 3, 2022 on Capitol Hill in Washington. The Federal Reserve is poised this week to begin unleashing its most drastic steps in three decades to attack inflation by making it costlier to borrow — for a car, a home, a business deal, a credit card purchase — all of which will compound Americans' financial strains and likely weaken the economy.
All told, the Fed’s credit tightening will likely mean higher loan rates for many consumers and businesses over time, including for mortgages, credit cards and auto loans. With prices for food, energy and consumer goods accelerating, the Fed’s goal is to cool spending — and economic growth — by making it more expensive for individuals and businesses to borrow. The central bank hopes that higher borrowing costs will slow spending enough to tame inflation yet not so much as to cause a recession.
Yet by most measures, the overall economy remains healthy. This is especially true of the U.S. job market: Hiring is strong, layoffs are few, unemployment is near a five-decade low and the number of job openings has reached a record high. Financial markets are pricing in a rate as high as 3.6% by mid-2023, which would be the highest in 15 years. Shrinking the Fed’s balance sheet will add another layer of uncertainty surrounding how much the Fed’s actions may weaken the economy.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Central Bank Watch: Fed Speeches, Interest Rate Expectations Update; May Fed Meeting PreviewRates markets are fully pricing in a 50-bps rate hike by the Federal Reserve on Wed. We’ll discuss how markets may react to the rate decision starting at 13:45 EDT/17:45 GMT on Wednesday.
Read more »
Here’s how you can prepare if there's a half point rate hike from the FedAs the Fed tries to pump the brakes on inflation, it will get more expensive to borrow. Here's how to prepare.
Read more »
Fed poised to hike rates by half a percentage point to fight inflationThe Federal Reserve is expected to raise interest rates again Wednesday, this time by half a percentage point, in an aggressive step toward combating the highest inflation in 40 years.
Read more »
Fed raises key rate by a half-point in bid to tame inflationThe Federal Reserve intensified its drive to curb the worst inflation in 40 years by raising its benchmark short-term interest rate by an sizable half-percentage point
Read more »
Fed raises key interest rate by a half-pointThe increase in the Fed’s key rate raised it to a range of 0.75% to 1%, the highest point since the pandemic struck two years ago.
Read more »
Fed expected to aggressively raise interest rates to tame inflationThe Fed is expected to raise interest rates this week with the biggest jump in more than 20 years as the central bank tries to get control of historic inflation.
Read more »