Federal Reserve Chair Jerome H. Powell announced a 0.75% federal interest rate increase. This is the third, three-quarter percent increase in a row. This brings the bank’s lending rate range to 3%-3.25%. This is the highest the federal interest rate has been since 2008. These aggressive moves by The Fed are supposed to lower the high inflation that is plaguing the country, and the rest of the world. An increase in the lending rates will have effects on the everyday American by increasing the cost of borrowing for big-ticket items like homes, cars, and credit cards. The Federal Reserve is taking aggressive measures to try to prevent a recession, but whether these moves will work to achieve that is unknown.
POWELL: “Today, the FOMC raised its policy interest rate by three-quarters of a percentage point and we anticipate that ongoing increases will be appropriate. We are moving our policy stance purposefully to a level, that will be sufficiently restrictive to return inflation to 2%.”
