Economists largely stuck to their forecasts that the Federal Reserve will raise interest rates to 5% by March and hold them there for most of 2023, even after inflation slowed last month by more than forecast.
Speaking at an IBJ economic forecast event Monday, a Fifth Third Bank economist said the chance of heading into another recession is “literally a toss-up, a coin flip.”
The Federal Reserve on Wednesday raised its key short-term interest rate to a range of 3.75% to 4%, its highest level in 15 years.
Looming over the Federal Reserve meeting that ends Wednesday is a question of intense interest: Just how high will the Fed’s inflation-fighters raise interest rates—and might they slow their rate hikes as soon as next month?
Rising interest rates, inflation and recession risks have eroded consumer confidence and left buyout firms facing a new reality of higher financing costs and potentially lower returns.
The cold months pretty much always herald a drop in residential real estate sales. It just isn’t a great time to schlep around looking at houses. This season, however, is expected to bring a lower dip than in recent years.
Federal Reserve officials will maintain their resolutely hawkish stance next week, laying the groundwork for interest rates reaching 5% by March 2023, moves that seem likely to lead to a U.S. and global recession, economists surveyed by Bloomberg said.
Many potential homebuyers have moved to the sidelines as mortgage rates have more than doubled this year. Sales of existing homes have declined for eight straight months.
The biggest U.S. chain of car dealerships said used-vehicle prices are softening as rising interest rates curb demand from more price-sensitive buyers.
The National Association of Realtors said Thursday that sales of previously occupied U.S. homes fell in September for the eighth month in a row.
The report stresses how high inflation has broadened across the economy, eroding Americans’ paychecks and forcing many to rely on savings and credit cards to keep up.
America’s employers slowed their hiring in September but still added a solid number of jobs, likely keeping the Federal Reserve on pace to keep raising interest rates aggressively to fight persistently high inflation.
Comments by Federal Reserve Governor Lisa Cook, Neel Kashkari and Raphael Bostic suggest the Federal Reserve is unlikely to slow its campaign against inflation anytime soon.
The beefier rates mark highs not seen in 15 years, before a crash in the housing market triggered the Great Recession.
A strong job market and lower gas prices appear to be contributing to more optimistic views of the economy. But inflation and rising interest rates both threaten Americans’ propensity to spend.
The Federal Reserve will have to keep boosting its benchmark interest rate to a point that raises unemployment and gets inflation down from unusually high levels, two officials said in separate remarks Monday.
The Federal Reserve boosted its benchmark short-term rate, which affects many consumer and business loans, to a range of 3% to 3.25%, the highest level since early 2008.
Economists expect Fed officials to forecast that their key rate could go as high as 4% by the end of this year. They’re also likely to signal additional increases in 2023, perhaps to as high as roughly 4.5%.
The Federal Reserve’s hopes for a “soft landing” rest on a rarely occurring phenomenon: Unemployment will rise not because workers lose their jobs, but because more people without jobs start looking for work.
Federal Reserve leader Jerome Powell acknowledged the rate hikes will hurt the job market and U.S. households, but he also said the pain would be worse if inflation were allowed to fester.
