The Fed's most aggressive economic tightening campaign in which the central bankers announced another sharp interest rate increase and signaled a...
It took stock-market investors a while to make up their minds, but when the closing bell sounded on Wednesday it was clear they didn’t like what they had heard from the Federal Reserve and its chairman Jerome Powell.
U.S. stock indexes finished sharply lower after swinging between gains and losses after the Fed raised the fed-funds rate by 75 basis points to a target range of 3% to 3.25%. That was expected.Central bankers also penciled in another 125 basis points in rate hikes by year end, which would bring the benchmark interest rate to a midpoint of 4.4% by the end of the year, plus a “terminal” rate — or peak — at 4.6% in 2023. They don’t expect any rate cuts until 2024.
See: Can the Fed tame inflation without further crushing the stock market? What investors need to know. The August consumer price index report released earlier this month found inflation had spread more broadly through the economy, with the year-over-year rate slowing less than expected to 8.3%. In his Jackson Hole speech, Powell warned that the economy and household would experience “some pain” as a result of the bank’s more aggressive effort to roll back inflation.
“We’re trying to get to acceptance,” he said, after bouts of “hopefulness” that have emerged during market bounces earlier this year, particularly as the S&P 500 rallied around 17% off its June low ahead of Powell’s Jackson Hole speech.“No one knows whether this process will lead to a recession or if so how significant that recession would be,” Powell said in the news conference.
But according to Casey, the chances of soft landing are getting slimmer because CPI numbers have been “stubborn and sticky”.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Wall Street drops 1% with focus on Fed By Reuters⚠️BREAKING: *U.S. STOCKS TUMBLE AS WALL STREET BRACES FOR SUPERSIZED FED RATE HIKE - 🇺🇸 🇺🇸
Read more »
4 things to watch when the Fed delivers its rate-hike decisionHere's what leading Fed watchers are looking for on Wednesday when the Fed announces its rate decision at 2 p.m. Eastern.
Read more »
Dollar Soars as Putin Ramps Up Tensions; Fed Meeting Looms By Investing.com⚠️BREAKING: *U.S. DOLLAR SOARS TO NEW 20-YEAR HIGH AS PUTIN RAMPS UP TENSIONS AHEAD OF FED -
Read more »
The Fed is declaring war on inflation. It could lead straight to recession.Jerome Powell has pledged to do whatever it takes to curb inflation, a point that he’ll punctuate on Wednesday when the central bank raises interest rates for the fifth time this year
Read more »
Breaking: Bitcoin Plunges as Fed Announces Another Big Interest Rate HikeFed policymakers have expectedly announced their third consecutive 75-basis-point rate hike
Read more »