To combat the increase in inflation for America’s economy….
The Federal Reserve will INCREASE borrowing costs….
This on top of increased energy costs for the country and Russian sanction fall out…
The Federal Reserve on Wednesday increased its baseline interest rate range, launching the first in what will likely be a series of rate hikes meant to fight inflation.
The Federal Open Market Committee (FOMC), the panel of Fed officials responsible for setting monetary policy, increased the federal funds rate by 0.25 percentage points to a range of 0.25 to 0.5 percent. The federal funds rate is the benchmark interest rate banks charge on loans to each other and used to set borrowing costs on credit cards, automobile loans, and mortgages.
Fed officials signaled for months that they would hike rates in March and begin pulling back stimulative interest rates after two years of rapid economic growth and high inflation.
The hike comes almost exactly two years after the Fed slashed rates to near-zero levels and began buying billions of dollars of Treasury bonds and mortgage-backed securities each month to stimulate the economy through the COVID-19 recession.
The U.S. economy has since recovered all but 2.1 million of the more than 20 million jobs lost during the onset of the pandemic, grew by 5.7 percent in 2021, and powered consumer spending well above pre-pandemic levels.
Economists credit unprecedented stimulus from both the Fed and Congress along with quick development of effective COVID-19 vaccines for the swift recovery of the U.S. economy.
Even so, the economy’s rapid rebound came with a spike in consumer prices…..