Federal Reserve points to moderation in December rate hikes

this Federal Reserve raise the accelerator’s feet and print the minutes of the last meeting of your Federal Committee. They suggest a moderation in rate hikes in December, according to the minutes released this Wednesday. It’s not that the price of money won’t stop rising, but it will stop less. The major concern of the American regulator was to fight inflation. October data was positive and the price increase recorded 7.7%, the smallest increase of the year, slightly less than the market expected. There was an upward trend in the stock markets on the day the data were announced. Faced with the prospect of softening inflation, the Fed seems open to easing its monetary policy aimed at reducing the lack of control over prices. Wall Street welcomed the Fed’s stance.

This Fed meeting took place earlier in the month, after which it was decided to raise interest rates to 75 basis points, the fourth so far this year and the sixth in 2022, to the range of 3.75% to 4%. Therefore, during the meeting, several attendees at the meeting indicated that it would be appropriate to slow the rate of increase as rates approached being sufficiently restrictive. In any case, the majority of central bankers “probably will be available soon“Slow the pace of increases.

Full employment and price stability

The following comment was made in the future discussion: A slower pace will allow the Fed to better measure progress towards full employment and price stability goals.. First of all, it is due to the indefinite lag of monetary policy in economic activity.

In this sense, some of the participants of the meeting were of the opinion that the slowdown in the rate of increase also reduced the risk of creating instability in the financial system. on your side, Other bankers have taken a more aggressive stance, only recommending slower hikes when rates are “more clearly in tight territory.” and there will be more tangible signs that inflation has declined significantly.

Source: Informacion

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