The Federal Reserve ordered another big boost in interest rates on Wednesday, and warned that rates will have to go even higher to bring stubbornly high inflation under control.The
The central bank raised its benchmark interest rate by 3/4 of a percentage point. The rate, which was near zero in March, has jumped 3.75 percentage points in the last eight months
That's the most aggressive string of rate hikes in decades, but so far it's done little to curb inflation.
"Interest rates have risen at a whiplash-inducing speed, and we're not done yet," said Greg McBride, chief financial analyst at Bankrate."Interest rates have risen at a whiplash-in
"It's going to take some time for inflation to come down from these lofty levels, even once we do start to see some improvement."
Annual inflation in September was 6.2%, according to the Fed's preferred yardstick — unchanged from the month before.Annual inflation in September was 6.2%, according to the Fed'
The better known consumer price index shows prices rising even faster, at an annual rate of 8.2%.The better known consumer price index shows prices rising even faster, at an annual
Fed chairman Jerome Powell warned that taming such severe inflation will likely require even higher interest rates than he and his colleagues had predicted just two months ago.
McBride argues that in order to curb inflation, borrowing costs will likely have to remain elevated for an extended period.McBride argues that in order to curb inflation, borrowing
"The mantra for 2023 is 'higher for longer,'" he said. "When inflation's been running at 6, 7, 8% and the target is 2%, it's going to take a while.""The mantra for 2023 is 'higher