US media: Disappointing results from the Federal Reserve's anti inflation measures may lead to further interest rate hikes, potentially affecting the Federal Reserve's inflation policy
Federal Reserve Chairman Powell
According to Bloomberg on September 13th, the Federal Reserve's anti inflation results have been disappointing, and higher than expected inflation may lead the Federal Reserve to choose to raise interest rates again in November or December of this year.
According to data from the US Bureau of Labor Statistics on the 13th, the core consumer price index rose 0.3% from July and 4.3% from a year ago, still far above the Federal Reserve's annual inflation target of 2%. "The core CPI is a bit disappointing. This will keep the Federal Reserve on hawkish guard and suggest that interest rates may rise in November and December," said Bos Jancich, Chief Economist of American Life Insurance Company. Federal Reserve Chairman Powell said at the Fed meeting at the end of August that inflation remains too high and the Fed is prepared to further tighten monetary policy if necessary.
Since March 2022, policy makers have raised the benchmark federal funds rate 11 times. The Federal Open Market Committee raised its benchmark interest rate to 5.25% to 5.5% in July, a 22 year high, and its latest forecast predicts another rate hike in 2023. However, as borrowing costs rise and household and business spending levels in the United States decrease, the US economy is being dragged down, with GDP growth rate dropping to only 1.1% in the first quarter of this year. Investors are also concerned that the Federal Reserve may go too far and quickly plunge the US economy into recession.
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