Turn on dark theme
Turn on light theme

search on refresher

Tech
0
Veronika Szűcs Rajničová
June 16, 2022, 8:35pm
Reading time: 0:45

Inflation Reached The United States. The Fed Interest Rate Has Been Raised More Aggressively Than In The Last 28 Years

During the year, the US will continue its cycle of tightening monetary policy, with rates rising sharper than expected.

Veronika Szűcs Rajničová
June 16, 2022, 8:35pm
Reading time: 0:45
Share
Share Share article
Stay fresh and follow us:
REFRESHER refreshercom

The US Federal Reserve has tightened monetary policy most aggressively in 28 years to slow inflation. The Monetary Committee (FOMC) raised the key interest rate by 75 basis points, reaching 1.50% to 1.75% on Wednesday. This is the sharpest increase in the key rate since 1994.

The Fed has also signaled that it will continue its monetary policy tightening cycle later this year, with interest rates rising sharper than expected. The reason is inflation, which accelerated in May and has now reached its highest level since December 1981.

 

Worse, than expected

The Fed currently expects the key rate to rise to 3.4% by the end of the year, which is 1.5 percentage points more than the March estimate. At the same time, the FOMC expects it to increase to 3.8% in 2023.

The Fed has also significantly worsened the outlook for the US economy this year. At present, it forecasts an increase in gross domestic product (GDP) by 1.7%. In March, they still predicted an expansion by 2.8%. The inflation forecast for this year rose to 5.2% from 4.3%. In 2023, the growth rate of consumer prices should slow to 2.6%.

Report content. If you've found mistake or have any issues with article, please let us know.
Thumbnail: Pexels/Alexandr Mills/Free use
Share
Share Share article
Most read
Home
Share
Discussion
Search
More