The Federal Reserve may hold off on another rate hike. Does that mean a break for your finances?
CBSAPR 2023
Powell and the Fed are playing with fire as the central bank pauses interest rate hikes yet again despite persistent inflation. While inflation isn’t at the record-high of 9% from last year, it's still far above the 2% target, and the Fed’s current rate isn’t moving the needle. While it might be painful for some, the US economy must cool down, and that still hasn’t happened yet.
The Fed is taking a prudent approach, pausing rate hikes after 11 consecutive increases to observe how the economy responds to the previous moves. While inflation isn’t quite where it needs to be, it has still cooled dramatically over the last year. There's no easy solution to balancing inflation and economic growth, and the Fed is right to keep its options open.