Federal Reserve Changes

For the ninth time in a year, the Federal Reserve announced on March 22 that it was raising interest rates by 0.25%. The hike will increase the benchmark federal funds rate to a target range of 4.75% to 5%. The move indicates that high inflation, currently at 6%, continues to threaten the economy. While unemployment is down, the job market and general price increases still have not stabilized.

The Chairman of the Federal Reserve, Jerome Powell, explained that there is still a long way to go to bring inflation back down to 2%. Additionally, the recent collapse of three large banks is likely to impact various elements in the economy.

Will the Fed manage to normalize inflation levels? Will the past year’s rate increases and bank downfalls be too damaging to the economy? Only time will tell…