Fed Hikes Interest Rates Again, Signals Openness to Pause
Summary from the AllSides News Team
The Federal Reserve said Wednesday it would raise interest rates by a quarter of a percentage point but signaled it could pause rate hikes if inflation continues to slow.
For Context: Coverage in multiple outlets said the quarter-point hike matched experts’ expectations. While inflation appears to be slowing, some have raised concerns about the broader impact of the Fed’s rate hikes. Experts have tied the failures of Silicon Valley Bank and First Republic Bank to a lack of financial safeguards against higher interest rates.
Key Quotes: In its May meeting statement, the Fed removed previous guidance, which said, “some additional policy firming may be appropriate” to get inflation under control. Instead, the new statement says, “In determining the extent to which additional policy firming may be appropriate to return inflation to 2 percent over time, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments.”
How the Media Covered It: Coverage was fairly similar across the spectrum, with several major outlets posting live updates ahead of the announcement. Fox News (Right bias) and NBC News (Lean Left bias) both highlighted that rates were how at a 16-year high. Washington Examiner (Lean Right bias) highlighted a rising “recession threat,” and AP (Lean Left bias) highlighted “bank turmoil.”
Featured Coverage of this Story
From the Center
Fed increases rates a quarter point and signals a potential end to hikesThe Federal Reserve on Wednesday approved its 10th interest rate increase in just a little over a year and dropped a tentative hint that the current tightening cycle is at an end.
In a unanimous decision widely expected by markets, the central bank’s Federal Open Market Committee raised its benchmark borrowing rate by 0.25 percentage point. The rate sets what banks charge each other for overnight lending but feeds through to many consumer debt products such as mortgages, auto loans and credit cards.
The post-meeting statement offered only some clarity on a potential pause...
From the Left
Fed raises interest rates, hints possible end to series of hikesThe Federal Reserve raised interest rates by a quarter percentage point on Wednesday, marking the 10th consecutive move in an aggressive hiking campaign that began a year ago to cool inflation.
Why it matters: As the banking system shows renewed signs of stress, the central bank gave its strongest signal yet that it could pause its series of rate increases.
Driving the news: In a policy statement, which is parsed by economists and traders, the Fed said it would monitor economic and financial data to assess "the extent to which additional policy firming...
From the Right
Fed raises interest rate a quarter-point; 10th hike in past year to fight inflationThe Federal Reserve raised a key interest rate Wednesday by a quarter percentage point, the 10th increase in just over a year that is hitting consumers with higher costs for home mortgages, auto loans and credit card balances.
The central bank said the action was needed to curb inflation that was at 5% in March. Inflation has come down from 8.5% a year ago, but is still more than twice the Fed’s target level.
In a unanimous vote, the Fed’s open market committee raised its borrowing rate to a target...
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