The central bank has been trying to slow the economy enough to prevent inflation from becoming more permanent without raising rates so starkly that the resulting shock inflicts undue pain on the labor market. The Fed’s war on inflation four decades ago - the last time price increases were this rapid - led to painfully high unemployment that cost families their livelihoods. But quick Fed rate adjustments also carry a risk: They have historically caused recessions as more expensive borrowing has slammed the brakes on business activity.
WHEN DOES FED SPEEK TODAY SERIES
Officials have already lifted the federal funds rate from near-zero in March to a range of 2.25 to 2.5 percent in July, making for the fastest series of policy moves since the 1980s.Ĭontinued rapid rate increases would help to cool down the housing market and broader economy, slow consumer spending and business expansions, and eventually weigh on wages and prices. But prices are still increasing at more than three times the pace the Fed aims for, creating a pressing challenge for consumers who are struggling to afford day-to-day necessities like rent and food as wages fail to keep up.įed watchers are hoping that this year’s meeting will both dissect what has gone wrong with inflation and how the Fed is thinking about its next steps as it tries to tame it. Inflation has shown some early signs of moderating, which could point toward a less aggressive Fed policy path. Markets are trying to guess when the central bank, which raised rates by an unusually quick three-quarters of a percentage point at each of its last two meetings, will slow down.
But it is getting special scrutiny this year as investors grasp for any hint at what might come next for the Fed, which has been raising rates rapidly in its campaign to tamp down the fastest rate of inflation in 40 years. Powell’s speech at the Federal Reserve Bank of Kansas City’s annual conference near Jackson, Wyo., is always closely watched.
WHEN DOES FED SPEEK TODAY UPDATE
Powell, the Federal Reserve chair, provides an update on the economic outlook that could detail how the central bank is thinking about inflation and the path ahead for interest rates. The most anticipated economic event of the summer is set to happen on Friday, when Jerome H.
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