45 ms·

For now. Inflation is also still rising, so I wonder what the fed will do next?

• Grimburger 4y ago
  Raise baby, raise.
• stjohnswarts 4y ago
  I think they will raise rates until we get into a severe recession and employers cease hiring and start firing. The feds only real knob is controlling rates and borrowing.
• refurb 4y ago
  Central bank go rrrrrrrbbbbb! (That’s brrr in reverse). Rates are going to keep increasing until inflation drops or the economy shows signs of a big slowdown.
• jfengel 4y ago
  Inflation and low unemployment often go hand in hand. Low unemployment (below 4%) comes from employers raising wages, and prices. So as far as the Fed is concerned, they have the same solution to both: raise interest rates. That will reduce the amount of money sloshing around the system, making it harder to hire and reducing demand for stuff. That raises unemployment and lowers inflation. At least, such is the zero-dimensional theory. Actual economic modeling is more complex. Inflation is also high due to the war in Ukraine (reducing energy supplies) and COVID (which is still backing up supply chains). Still, it all points in the same direction: raising interest rates. Which they should have done 10 years ago, to be honest, but once again the Fed failed to take away the punch bowl and the party rolled on. The very high inflation we see now is a consequence of that.