The United States Federal Reserve has increased the benchmark rate from 0.25% in March 2022 to 5.50% after its most recent interest rate hike decision on July 26, 2023. There have been 11 interest rate hikes over that period. The central bank has managed to temper soaring inflation rates, but it has come at the cost of putting significant pressure on an already overleveraged population. Meanwhile, both the stock market and real estate market have experienced pullbacks.
On Wednesday, November 1, 2023, US Federal Reserve chairman Jerome Powell revealed that the central bank had opted to leave rates unchanged. Investors will now look ahead to the US Fed’s next meeting on December 12 and 13.
Fed chairman Jerome Powell said that a pause on rate hikes did not mean that it would be difficult to go back to tightening. Meanwhile, Powell said that central bank policymakers were not thinking of putting rate cuts on the table at this stage. Indeed, the US Federal Reserve still has its sights set on the 2% inflation target that it set when it embarked on this tightening cycle. The US inflation rate was reported at 3.7% in September 2023. That means that there is still more progress that must be made before citizens and investors alike can look forward to some monetary easing.
Many experts and analysts are confident that Powell and the Fed are just about ready to close the book on their tightening campaign. However, any downward movement is unlikely until the middle of next year at the very earliest.
Related Stories
