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(KNSI) – The United States Federal Reserve announced a third straight 0.75% interest rate hike on Wednesday. The central bank’s chairman, Jerome Powell, held a press conference after the decision and promised more aggressive action to help tame inflation before a higher figure becomes expected.

“The longer the current bout of high inflation continues, the greater the chance that expectations of higher inflation will become entrenched.”

The Federal Reserve is now predicting that the nation’s unemployment rate will jump to around 4.5% by next year as the economy is slowed through tighter monetary policy. Minnesota lost jobs last month, the first such instance this year.

Powell says the pain is only intended to be temporary and tamping down inflation is necessary for economic prosperity in the future.

“When inflation is low and stable you can see what we saw in 2018, ’19, and ’20, which was very low unemployment, the biggest wage gains going to people at the low end of the spectrum, [and] the smallest racial gaps that we’ve seen him since we started keeping track of that. We want to get back to that.”

The hike marks the fifth interest rate increase of 2022, with more expected before year’s end. The end result for consumers is more expensive car and home loans, as well as a greater credit card bill. Inflation is now forecast to remain elevated until 2025 above the two percent target.

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