Worthy Christian News > US News > Fed Reserve expected to announce fourth consecutive interest rate hike

Fed Reserve expected to announce fourth consecutive interest rate hike

by Karen Faulkner, Worthy News Correspondent

(Worthy News) – The US Federal Reserve is expected Wednesday to announce its fourth consecutive 0.75% interest rate hike since June, Reuters reports. Numerous economists polled by Reuters have said the Fed should not pause until inflation falls to around half its current level.

A large majority of economists told Reuters they expect to see an increase in the federal funds rate by three-quarters of a percentage point to 3.75%-4.00% on November 2, while inflation remains high and unemployment falls to near pre-pandemic lows.

Referring to rates adjusted for inflation, Jan Groen, chief U.S. macro strategist at TD Securities, told Reuters: “The front-loading of policy rate tightening we have seen up to now has been aimed at getting to a positive real fed funds rate at the start of 2023.”

“Instead of a pivot, in our view, the Fed is signaling that they foresee shifting from front-loading up to December, towards more of a more grinding pace of hikes from then onward,” Groen added.

In a separate statement to Reuters, Brett Ryan, senior U.S. economist at Deutsche Bank, predicted: “With the Fed continuing its aggressive tightening to rein in persistent inflation, we expect a moderate recession likely to begin in Q3 next year as the real growth would dip negative, and the unemployment rate will rise substantially.”