8/21/2023 0 Comments Federal reserve next meetingGoldman Sachs economists revised their base case on Saturday to include four rate hikes through 2022, citing extraordinarily strong wage growth and Omicron's impact on supply chains for the updated outlook. The report prompted several calls for more urgent monetary tightening. The Consumer Price Index showed inflation running at a 7% year-over-year rate in December, accelerating from the prior month's 6.8% rate and marking the fastest price growth since 1982. Yet inflation data published in the following weeks has fueled worries that the Fed's pace isn't aggressive enough to cool the price surge. The Fed's latest economic projections – published in December – showed policymakers expecting to raise rates three times in 20. "In light of the remarkable progress we've seen in the labor market and inflation that is well above our 2% longer-run goal, the economy no longer needs sustained high levels of monetary policy support," Powell said. The central bank said in previous meetings that the economic recovery has progressed enough for it to pull back on some of its support and instead focus on cooling inflation. Raising the rate leads banks and other lenders to lift their own interest rates, affecting everything from credit card payments to car loans. The Fed's interest rate is considered the country's most powerful tool for fighting inflation. "I would say the committee is of a mind to raise the federal funds rate at the March meeting assuming that conditions are appropriate for doing so," Powell said in a Wednesday press conference. Account icon An icon in the shape of a person's head and shoulders.
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