As elevated inflation persists, Federal Reserve officials are likely to approve another 75 basis point interest rate hike as they try to cool the U.S. economy.
. Officials approved a third straight 75 basis point rate hike in September, lifting the federal funds rate to a range of 3.0% to 3.25% — near restrictive levels — and showed no signs of slowing down as they try to crush runaway inflation.
A new Labor Department report last week showed the consumer price index, a broad measure of the price for everyday goods including gasoline, groceries and rents, rose 0.4% in September from the previous month and 8.2% on an annual basis, far faster than experts anticipated. "We haven’t yet made meaningful progress on inflation," Fed governor Christopher Waller said during a recent speech. In an even more concerning development that suggests underlyingin the economy remain strong, core prices, which strip out the more volatile measurements of food and energy, climbed 0.6% in September from the previous month. From the same time last year, core prices jumped 6.6%, the fastest since 1982.
"CPI came in hot, which virtually guarantees the Fed will hike 75 basis points next month and at least 50 in December," said Robert Frick, corporate economist with Navy Federal Credit Union. "And we need to brace for more bad news in October and November as rising oil prices are likely to swing again from reducing to increasing inflation."will trigger an economic downturn as it raises interest rates at the fastest pace in three decades to catch up with runaway inflation.
Economic growth already contracted in the first two quarters of the year, with gross domestic product — the broadest measure of goods and services produced in a nation — contracting by 1.6% in the winter and
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