The Fed is likely to hike rates

Jasonc13
2023-03-22

• The Federal Reserve is expected to increase interest rates by a quarter point Wednesday, even with concerns about stress in the banking system.

• The central bank is also expected to release projections about the economy and the path of rate hikes, though some economists say it may have a difficult time making those forecasts due to uncertainty.

• Investors are also looking for assurances from the Fed that the issues with regional banks will be contained.

The Federal Reserve is expected to raise interest rates Wednesday by a quarter point, but it also faces the tough task of reassuring markets it can stem a worse banking crisis.

Economists mostly expect the Fed will increase its fed funds target rate range to 4.75% to 5% on Wednesday afternoon, though some expect the central bank could pause its hiking due to concerns about the banking system. Futures markets were pricing in a roughly 80% chance for a rate rise, as of Tuesday morning.

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