This Might Be The Last Interest Rate Hike
(AmericanProsperity.com) – Americans have been struggling to pay for essentials as inflation continues to remain elevated. The Consumer Price Index was up 8.2% over the past 12 months ending in September. The Federal Reserve has been increasing interest rates to combat inflation, but their most recent spike could be their last.
— The Hill (@thehill) November 1, 2022
The central bank is gearing up for yet another major rate hike. Economic experts and analysts feel the Fed could increase its baseline interest by an additional 0.75%, or 75 basis points. If the central bank follows through, it will mark the fourth time in a row the Reserve has jacked up interest rates by an amount it once considered uncommon.
The hike could also serve as a turning point for the Fed’s battle against stubborn inflation. The central bank has been under pressure to ease up on the economy’s brakes. Those watching the central bank will be keeping an eye out for signs that officials are nearing a point when they can start planning to set future interest rates.
There are no expectations that Jerome Powell, chairman of the Federal Reserve, will announce a suspension of rate hikes.
Powell has mentioned his intentions of keeping the pressure on until there are clear indications that price growth is declining. So far, the interest rate hikes have caused a drastic decrease in home sales and driven prices down for the first time in over a decade. Additionally, firms haven’t been as willing to invest in long-term assets, and businesses have decreased the amount of people they’re hiring, leading to a slowdown in wage growth.
Could these be the signs the Fed is looking for to indicate when to stop increasing interest rates? Perhaps the next hike will be the last for the foreseeable future.
~Here’s to Your Prosperity!
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