The Federal Reserve has raised interest rates for the first time since 2023, emphasizing its focus on price stability after determining that inflation remains above target levels. Analysts suggest the central bank is unlikely to pursue rapid rate hikes, with expectations pointing to just two increases this year, potentially skipping the October meeting. Market observers note that further moves depend on inflation data and energy price trends, with a possible final adjustment in December still under review. The decision reflects cautious monetary policy amid economic uncertainty.
Fed chair says it is focusing on price stability as committee decided that inflation was not ‘moving to our objective’US Federal Reserve raises interest rates for the first time since 2023Kay Haigh, global head and CIO of Fixed Income and Liquidity Solutions at Goldman Sachs Asset Management, has this analysis of today’s decision:The Fed has signalled it does not at this stage envisage an aggressive tightening cycle. Most FOMC members see a total of two hikes this year per the SEP, and it will likely skip October’s meeting given its proximity to the midterm elections. One more hike this year in December is our base case, although this remains contingent on upcoming CPI reports and the path of energy prices. Continue reading...
