The Clap
Despite the CPI coming in lower than expected, the Fed hiked interest rates by 0.5% to become 4.5%.
What
The hike puts interest rates at their highest level in 15 years, adding to the most aggressive hiking of interest rates since the 90s.
The interest rate hike was in line with analysts’ expectations and broke the streak of four consecutive 0.75% rate hikes.
So What
Despite signs that inflation is cooling, the Fed does not plan to ease the pressure on the economy as they intend to hold interest rates at a high level all throughout 2023.
The Fed’s Chair indicated in his comments that the battle against inflation is far from over.
Now What
More interest rate hikes are expected to occur until the rate hits 5.1%, also known as the terminal rate.
