The third straight month of supersized rate increase.
On Wednesday, the Federal Reserve raised rates by three-quarters of a point and projected a more aggressive path ahead, suggesting that borrowing costs would be increased to 4.4 percent by the end of the year.
Asked about the chances of a soft landing, Fed Chairman Jerome Powell said that “no one knows if this process will lead to a recession.” He said it was always going to be “very challenging“ to bring down inflation without causing a recession.
He continued to stress the large number of job openings relative to the number of unemployed workers as a sign that the labor market remains hot, despite some hints of a slowdown in other indicators. He also said a peak in commodity prices and supply chain pressures are beginning to resolve.
But he emphasized that it is still very early relative to a recession. “We do see some evidence of the beginnings of that; it’s not much more than that.”
The Fed’s rate was set at near zero as recently as March, and the increases since then have made for its fastest policy adjustments since the 1980s.
As the Lord Leads, Pray with Us…
- For members of the Federal Reserve as they continue to raise interest rates.
- For Chairman Powell to be discerning in addressing inflation.
- For the president and his administration as they assess the possibility of a recession.
Sources: NY Times, Newsmax
