Fed increases interest rates as expected while US economy teeters on edge of recession, with Jerome Powell saying ‘inflation is much too high’
The Federal Reserve’s just-announced decision to increase interest rates by three-quarters of one percent, the fourth rise this year, was not entirely unexpected, as my colleagueWith the US economy teetering on the edge of a recession and inflation running at a four-decade high, theannounced another three-quarter of a percentage point increase in its benchmark interest rates on Wednesday, the second such increase in just over a month.
So far the rate rises appear to have done little to rein in rising prices and the costs of everything from food and rent to gas remain high. The Fed will not meet again until September, at which point more economic data will be available, and its decision committee should be better able to see if its policy is working.
Recessions are, however, officially declared by the National Bureau of Economic Research , a research group that uses a broad range of measures including jobs growth to decide when theis shrinking. The NBER often makes its announcement well after a recession has begun, as it assesses other economic factors.
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