Fed raises rates by half a percentage point — the biggest hike in two decades — to fight inflation
CNBCJUL 2022
The Spin
Establishment-critical narrative
The Fed's goal to dampen inflation without inducing a recession - known as a "soft-landing" - is a pipe dream. The central bank waited too long to start cooling inflation and is now overcompensating, which runs the risk of slowing the economy so much that it shrinks.
Pro-establishment narrative
There is broad consensus among Fed bankers and economists that it's time for some quantitative tightening to rein in inflation, and the market is breathing a sigh of relief after the latest announcement. While the process of bringing down inflation is not pain-free, the economy is strong and a recession isn't likely.
Metaculus Prediction
There is a 66% chance that the US will enter a recession before Jan. 2024, according to the Metaculus prediction community.
