The Federal Reserve is hoping to achieve the rarest of economic feats as it moves into full inflation-fighting mode: cooling consumer demand enough so that prices stop rising, without crushing it so much that it throws the country into a recession.
11 tightening cycles since 1965, of which eight were followed by recessions. Still, that doesn't mean a severe recession is guaranteed: There were five instances of either very mild recessions in which GDP fell less than 1% or there was no economic decline at all.
Median projections show that central bank officials are confident they can engineer such a landing: They anticipate core inflation falling to 4.1% at the end of the year, 2.4% next year and 2.3% in 2024, while they believe unemployment will hold steady at 3.5% to 3.6% for some time. Traders are already pricing in at least a 100% chance of a half-point rate increase at the conclusion of the Fed's May meeting on Wednesday, in addition to at least three more 50-basis point hikes at the central bank's subsequent meetings in June, July and September, according to the CME Group, which tracks trading.
And last week, the Bureau of Labor Statistics reported that the economy unexpectedly shrank in the first quarter of the year, marking the worst performance since the spring of 2020, when the U.S. economy was still deep in the throes of the COVID-induced recession.
Österreich Neuesten Nachrichten, Österreich Schlagzeilen
Similar News:Sie können auch ähnliche Nachrichten wie diese lesen, die wir aus anderen Nachrichtenquellen gesammelt haben.
Bitcoin, Ethereum Technical Analysis: BTC Below $40,000 Prior to Wednesday’s Fed Meeting – Market Updates Bitcoin NewsBTC continued to trade below $40,000 prior to Wednesday’s FOMC meeting, as crypto markets anticipated a potential rate hike.
Weiterlesen »
S&P 500 Futures portray pre-Fed market consolidation, Japan’s holiday chains yieldsGlobal markets remain jittery, mildly positive though, as traders remain cautious ahead of the key Federal Open Market Committee (FOMC) meeting outcom
Weiterlesen »
4 things to know as the Fed embarks on its biggest fight against inflation in yearsThe Federal Reserve is expected to approve its largest interest rate hike in more than two decades this week. Additional rate increases are likely, as the Fed tries to regain control over inflation.
Weiterlesen »
The Fed can't prevent a recession, Larry Summers and his co-author sayOPINION: Our recent research suggests there is a significant likelihood of a recession in the not-too-distant future. That’s because high inflation and low unemployment are both strong predictors of future recessions.
Weiterlesen »
Here’s how you can prepare if there's a half point rate hike from the FedAs the Fed tries to pump the brakes on inflation, it will get more expensive to borrow. Here's how to prepare.
Weiterlesen »