Rate hikes Financial News

economic activity had been stronger than earlier anticipated, and there were few clear signs that inflation was on a path to return to the Committee's 2 percent objective over time," the Fed said. In the end, almost all participants judged it appropriate or acceptable to maintain" the federal funds rate at the existing 5% to 5.25%, the minutes said.  "Most of those participants observed that leaving the target range unchanged at this meeting would allow them more time to assess the economy's progress," toward returning inflation to 2% from its current level more than twice that.

By Yasin Ebrahim

Almost all Federal Reserve officials at their June meeting indicated further policy tightening is likely, if at a slower pace than the rapid-fire rate increases that had characterized monetary policy since early 2022, according to minutes released Wednesday. Policymakers decided against a rate increase amid concerns over economic growth, even though most members think further hikes are on the way. Citing the lagged impact of policy and other concerns, they saw room to skip the June meeting after enacting 10 straight rate increases. Officials felt that «leaving the target range unchanged at this meeting would allow them more time to assess the economy's progress toward the Committee's goals of maximum employment and price stability.» Federal Open Market Committee members voiced hesitance over a multitude of factors. They said that a brief pause would give the committee time to assess the impacts of the hikes, which have totaled 5 percentage points, the most aggressive moves since the early 1980s. «The economy was facing headwinds from tighter credit conditions, including higher interest rates, for households and businesses, which would likely weigh on economic activity, hiring, and inflation, although the extent of these effect remained uncertain,» the minutes stated. The unanimous decision not to hike came in «consideration of the significant cumulative tightening in the stance of monetary policy and the lags with which policy affects economic activity and inflation.»

The Fed’s efforts to tame stubborn inflation have impacted most Americans in the pocket, with 61% reporting a financial hit in the past 12 months as a result of interest rate hikes.

The May consumer price index (CPI) rose 3.4 per cent year over year, which was a big drop from the 4.4 per cent year-over-year number in April, but that doesn’t tell the real story.

Bitcoin (BTC) staged another retest of $30,000 support on June 28 as the United States Federal Reserve stayed hawkish on inflation.

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Federal Reserve Chairman Jerome Powell on Wednesday affirmed that more interest rate increases are likely ahead until additional progress is made on bringing down inflation.

The market has long been pricing in interest rate cuts from major central banks toward the end of 2023, but sticky core inflation, tight labor markets and a surprisingly resilient global economy are leading some economists to reassess.

Federal Reserve officials were divided at their last meeting over where to go with interest rates, with some members seeing the need for more increases while others expected a slowdown in growth to remove the need to tighten further, minutes released Wednesday showed.

Bitcoin (BTC) nudged $27,000 after the May 19 Wall Street open as the Chair of the United States Federal Reserve delivered comments on policy.

Dallas Federal Reserve President Lorie Logan said Thursday that the economic data points so far don't justify skipping a rate increase at the central bank's next meeting in June.

The global debt pile grew by $8.3 trillion in the first quarter to a near-record high of $305 trillion as the global economy faced a «crisis of adaptation» to rapid monetary policy tightening by central banks, according to a closely-watched report from the Institute of International Finance.

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European Central Bank policymakers are reconsidering the path of interest rate hikes in light of last month's banking turmoil, but remain committed to reining in core inflation.

Bitcoin was last up 1.96% at $30,233. (Representational)

Bitcoin (BTC) saw heavy volatility on March 22 as the United States Federal Reserve hinted that it might stop interest rate hikes.

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Bitcoin (BTC) starts a new week in an unmistakably bullish position as it passes $28,000.

When the Federal Reserve starts to raise interest rates, it generally keeps doing so until something breaks, or so goes the collective Wall Street wisdom.

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