US Federal Reserve continues to accelerate and increase the price of money by 0.75 percentage points

The US Federal Reserve, which focuses on fighting inflation, increasing its price by 0.75 points. money, As you did last month. This is the fourth increase this year, after a 0.25 point increase in March. the new cycle began after four years of inactivity in this sense; 0.50 in May and 0.75 in June). With this decision, which documents the commitment to fight price increases, the interest rate is between 2.25% and 2.50%, above the interest rate. pre-pandemic levels. President of the institution, Jerome PowellHe began his press conference by insisting on the Fed’s commitment to taming inflation. economic activity shows more signs of weakness.

The central bank of the world’s leading power assures that “recent spending and output indicators have softened, but job creation has been solid in recent months and the unemployment rate remains low”. In any case, the biggest challenge is “high inflation”The pandemic reflects supply-demand imbalances related to rising food and energy prices and wider price pressures.”

The entity, which does not exclude new increases, highlights the effects of Russia’s war against Ukraine. And he emphasizes that he aims “to achieve maximum employment and inflation of 2% in the long run”. “Committee (body that decides interest rates) Determined to bring inflation back to its 2% targetHe assured that, in the current conditions, monetary policy decisions will be taken “from meeting to meeting” in the longer term, as the European Central Bank (ECB) said. .

Last month, the head of the United States Federal Reserve (Fed), Jerome Powell He suggested that the agency would continue its policy of raising interest rates even if the country risks falling into a crisis. recession, a scenario it does not exclude. In June, inflation of 9.1% at its level 40 years ago released all alarms. And even more worried 5.9% of core inflationThe most volatile elements such as energy and unprocessed food are excluded, which means that the increase in prices is transferred to the economy as a whole.

The priority of the monetary authority is a inflation it’s unstable But unlike Europe where the problem is offerbecause in the USA demand acceleration due to high employment, which overheats the economy. After the announcement of the US stock market, it strengthened the uptrend.

The Fed raised the price of money that hasn’t been in 28 years, by 75 percentage points last month, to 1.5 percent and 1.75 percent. By contrast, he forecast the new increase at Wednesday’s meeting to be 0.5 or 0.75 points. And he chose the top of the fork.

The European Central Bank (ECB), which chose to tighten its monetary policy later, accepted a 0.50 percentage point increase last week, double the amount announced by its president. Christine Lagarde, closing the 11-year cycle of cheap money and marking the largest one-time increase in 22 years. At the same time, it approved a mechanism to prevent possible escalations in the risk premium of countries in the euro area.

This difference between the dollar zone and the euro zone has recently strengthened the US currency. parity reached with the common European currency for the first time in 20 years.

Source: Informacion


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