The Federal Reserve is expected to make history yet again on Wednesday, approving a fourth-straight rate hike of three-quarters of a percentage point as part of an aggressive battle to bring down the white-hot inflation that is plaguing the US economy.
The Federal Reserve is expected to make history yet again on Wednesday, approving a fourth-straight rate hike of three-quarters of a percentage point as part of an aggressive battle to bring down the white-hot inflation that is plaguing the US economy.
The supersized hike would bring the central bank’s benchmark lending rate to a new target range of 3.75% to 4%. That’s the highest the fed funds rate has been since January 2008.
Wednesday’s decision, which comes at the end of a two-day policy meeting of the Federal Open Market Committee, would also mark the Fed’s toughest policy move since the 1980s and will likely deepen the economic pain for millions of American businesses and households by pushing up the cost of borrowing even further. There’s also a chance it could trigger a recession.
While Fed Chair Jerome Powell has stressed that persistent, entrenched inflation would bring greater economic suffering than a recession would, he has also acknowledged the economic hardships that result from tightening monetary policy.
