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We’ve got five big things you need to know about the Federal Reserve’s move to raise interest rates. We’ll also look at why the rate hike will keep pushing mortgage rates higher and a take on why corporate profit margins are pushing up inflation.
???? But first, read about the time former President Obama found Bono passed out in the White House.
Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom. Someone forward you this newsletter?5 key takeaways from the Fed’s latest rate hike
The Federal Reserve ramped up its battle against inflation Wednesday with another large interest rate hike amid griping that the central bank’s efforts will plunge the U.S. into a recession.
The Fed boosted its baseline interest rate range by 0.75 percentage points for the fourth time in four consecutive meetings.
The rate increase was the sixth of the year and brought the Fed’s baseline interest rate range to a span of 3.75 to 4 percent.
While the rate hikes marked yet another aggressive move to lower inflation — which has stayed stubbornly high for months — the Federal Reserve sounded a slightly softer tone in its messaging about its future actions.
Rate hikes will get smaller, but they’re not going away soon: Fed Chair Jerome Powell said that point could come as soon as the central bank’s next policy meeting in December. But he made clear that the Fed will continue raising interest rates.
The Fed sees the economy slowing but the labor market holding strong: The economic slowdown is one intended effect of the Fed’s rate hikes. Even so, Powell said the resilience of the labor market is one of several factors allowing Americans to keep spending money in the face of inflation.
Americans will get pummeled by high interest rates: Powell said Wednesday the Fed will need to push its baseline interest rate even higher than officials projected in September. Americans will see the direct impacts in higher mortgage rates, credit card rates and other adjustable rate loans.
A recession will be harder to avoid: Powell acknowledged Wednesday that the chances of avoiding recession were slimming with inflation remaining well above the annual target.
Global turmoil won’t be a deterrent: Powell said the Fed is mindful about how global economic headwinds could affect the U.
