12/14/2022–|Last Updated: 12/14/202215:35 (Mecca)
The US Federal Reserve (central bank) to release statement from its Open Market Committee meeting this Wednesday evening, followed by a press conference by its chairman, Jerome Powell, amid speculation of a seventh consecutive interest rate hike this year .
Wall Street analysts estimate today’s interest rate hike will be 50 basis points, which, if it does occur, would be the first cut in the hike after 4 consecutive 75 basis point hikes.
The US Federal Reserve received reassuring data from the US Bureau of Labor Statistics on Tuesday as annual inflation rates in the country fell to 7.1% last November, down from 7.7% last October.
Starting last March, the US Federal Reserve implemented the first interest rate hike of 25 basis points, from 0.25% to 0.50%, with signs of an acceleration in inflation, due to the consequences of the Russo- Ukraine.
Currently, interest rates in the US are between 3.75% and 4%, before a potential hike is implemented today.
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Last month, Powell acknowledged that the monetary tightening process had come to an end, signaling an end to aggressive 75 basis point rate hikes.
However, a report released Tuesday in the Wall Street Journal showed divisions among Fed members, as some support the continuation of monetary tightening, while others see the need to halt sharp interest rate hikes.
The most important question global markets are waiting for is when to stop interest rate hikes and begin a downward journey, to give markets a period to regain momentum.
Sharp interest rate hikes have caused stagnation in the US housing market, as well as damage to emerging market currencies, and interest rate hikes for many countries around the world that have followed the Fed’s lead in raising interest rates. taxi.
