Headline RoundupMay 3rd, 2023

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.”

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