Newest Federal Reserve Minutes: More of the Same
Minutes released by the Federal Reserve on February 22nd align with the actions they’ve taken over the past several months in an attempt to combat inflation. While the Federal Reserve raised rates last month by 25 basis points, some members suggested that a 50-basis point was a better alternative. The 50-basis point hike was suggested because they believed that it would help achieve the goal of reducing inflation to the 2% goal much faster.
Next month, it is likely that the Federal Reserve will raise rates by 25 basis points again, but it shouldn’t come as a shock if they decided on a 50-basis point increase. This comes on the heels of a stronger-than-expected jobs report in January. Sentiment surrounding the jobs report suggests that inflation could reignite if the labor market and economy continue in their current trend. While the price of goods has come down a little and the housing market has responded to the higher interest rates, one sector remains strong. The services sector has continued to show growth and increased wages.
The release of the minutes caused major indexes on Wall Street to drop just over 1% in their second straight day of decline.
For more information reach out to the Professionals at The Center for Financial, Legal, & Tax Planning Inc. at (618) 997-3436