Federal Reserve officials on Wednesday raised their forecasts for the target range for interest rates at the end of questyear and next, indicating that they expect a further decline in inflation in the near term compared to three months ago.
New quarterly forecasts from US central bank officials released today, Wednesday, along with a 75 basis point interest rate hike, showed that their forecast media for the benchmark interest rate it is expected to rise to 3.4% by the end of 2022. Their forecast in March was 1.9%.
The federal funds rate is now expected to be 3.8% at the end of 2023, in increase compared to 2.8% of the March forecast, while it should reach 3.4% at the end of 2024, compared to 2.8%, in expectations in March, reflecting expectations that the central bank will cut rates by then.
For his part, Fed Chairman Jerome Powell expected the next meeting’s decision to raise interest rates between 50 and 75 basis points.
Federal Reserve officials now predict annual inflation to end quest’year will be 5.2%, in increase compared to the March forecast of 4.3%.
They also expect an unemployment rate of 3.7%, at the end of 2022, compared to 3.4%, in their expectations in March. The unemployment rate in the United States was 3.6% in May.
Read More About: World News