Fed shines with latest rate hike
The story: The Fed raised interest rates by three-quarters of a percentage point for the third time in a row on Wednesday and signaled that at least one more rate hike of this magnitude is likely this year. Federal Reserve Chairman Jerome Powell said U.S. central bankers were “firmly determined” to bring inflation down from the highest level in 40 years. “We are committed to bringing inflation back down to 2% as we see failure to restore price stability. The Fed raises its target rate to a range of 3.00%-3.25% – the highest level since 2008 – and new forecasts show that by The policy rate will rise to between 4.25%-4.50% by the end of the year to reach 4.50%-4.75% of economic potential in 2023. Powell: “We have to bring supply and demand back into line. The way we do it is by slowing down the economy. Kevin Mahn, president and chief investment officer of Hennion & Walsh Asset Management, said on Wednesday he told the Federal Reserve that it would continue to raise rates so aggressively. // We know the economy has now reached the technical definition of a recession and the yield curve has held Inversion. The yield curve has remained inverted before every recession in our country since 1955. So if the Fed is actually still as hawkish as their dot plot suggests, I believe that could push the economy into A deeper and more protracted recession than ever before. The projected federal funds rate at the end of this year indicates that the Fed will raise rates by 1.25 percentage points at the remaining two policy meetings in 2022, a level that implies an imminent increase of 75 basis points. Rate cuts won’t take place until 2024.