Fed Raises Interest Rates to Fight Inflation One Week Before Midterms
The Federal Reserve once again raised interest rates by three-quarters of a percentage point — an effort to fight persistent inflation by indirectly raising borrowing costs to slow down the economy. The increase brings the target federal funds rate to its highest level since 2008.
Key Quotes: Some have raised concerns that the Fed’s interest rate hikes could slow the economy too quickly and spark a recession. Addressing these concerns, central bankers wrote that future rate hikes would “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.” However, Fed Chairman Jerome Powell told reporters that “we still have some ways to go” before ending rate hikes.
For Context: Recent polling suggests voters see inflation and the economy as top issues in the 2022 midterm elections. However, interest rate adjustments are the administration’s primary means of controlling inflation, and Fed officials are not elected. Recently-released data showed an unexpected rise in job openings, and the Fed once again cited “robust” job gains in its rate hike report.
How the Media Covered It: Coverage was widespread across the news media, particularly in business-focused outlets. Initially, there were no clear differences between coverage from the left and right. Some headlines sensationally described the rate hike as “supersized,” “jumbo,” and “monstrous.”
Featured Coverage of this Story
From the RightFed hikes rates by 0.75 points again — but signals smaller increases ahead
The Federal Reserve imposed another super-charged interest rate hike Wednesday, but officials signaled a move to smaller increases is in store as fears mount that inflation-fighting efforts will prompt a recession.
The rate-making Federal Open Market Committee hiked its benchmark rate by three-quarters of a percentage point following a two-day meeting. The latest hike moved the Fed’s target funds rate range to between 3.75% and 4% — the highest since 2008.
During his post-meeting conference, Fed Chair Jerome Powell signaled the central bank could begin dialing back the pace of its increases...
From the LeftFed unleashes another big rate hike but hints at a pullback
The Federal Reserve pumped up its benchmark interest rate Wednesday by three-quarters of a point for a fourth straight time to fight high inflation but hinted that it could soon reduce the size of its rate hikes.
The Fed’s move raised its key short-term rate to a range of 3.75% to 4%, its highest level in 15 years. It was the central bank’s sixth rate hike this year — a streak that has made mortgages and other consumer and business loans increasingly expensive and heightened the risk of a recession....
From the CenterFed approves 0.75-point hike to take rates to highest since 2008 and hints at change in policy ahead
The Federal Reserve on Wednesday approved a fourth consecutive three-quarter point interest rate increase and signaled a potential change in how it will approach monetary policy to bring down inflation.
In a well-telegraphed move that markets had been expecting for weeks, the central bank raised its short-term borrowing rate by 0.75 percentage point to a target range of 3.75%-4%, the highest level since January 2008.
The move continued the most aggressive pace of monetary policy tightening since the early 1980s, the last time inflation ran this high.