Washington- The US Federal Reserve concludes its monetary policy meeting tomorrow after which it is expected to announce a rise in interest rates, the sixth in a row, which the markets expect to return to 75 basis points.
The members of the Federal Reserve Open Market Committee began their November meeting on Tuesday after which they are expected to announce a new rise in interest rates, which they intend to continue pushing to control inflation.
According to experts, the rise will again be 0.75% and with it the US central bank will chain six consecutive increases since last March, when the regulator decided to start acting to stop the rise in prices that began as a result of the pandemic and failures of the global supply chain.
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If the forecasts are fulfilled, the official interest rate of the largest economy in the world will thus be placed in a range between 3.75 and 4%, a level not seen since 2007.
In the previous meeting in September, the president of the Fed, Jerome Powell, already advanced that the appropriate thing is to continue making “more interest rate increases in the future”, until inflation is controlled and that “at some point, at As the monetary policy stance tightens further, it will be appropriate to reduce the pace of increases.
But everything seems to indicate that what is known as the “terminal rate”, the maximum interest rate up to which one is willing to reach, is still far from being reached, since inflation has not yet dropped notably.
According to the latest data published two weeks ago by the Bureau of Labor Statistics (BLS, in English), the year-on-year inflation rate fell for the third consecutive time in September and stood at 8.2%, although consumer prices rose four tenths monthly.
After the Fed meeting in September, the regulator itself revealed its economic forecasts that contemplate, among other things, an interest rate of 4.4% by the end of 2022.
By the end of 2023, they expect rates to rise slightly to 4.6%, before falling to 2.9% by the end of 2025.
These estimates do not represent a road map, since the decisions of the central bank will depend on the evolution of the economy and the effects that the return to a more restrictive monetary policy will have on inflation.
Created in 1913, the Fed operates as a central bank in the United States. Its main body is the Board of Governors, made up of seven members nominated by the country’s president and confirmed by the Senate. There are also 12 other Feds in as many regions of the United States to monitor local economies and their banks.
The person in charge of deciding whether or not to raise rates is the Federal Open Market Committee (FOMC), which is made up of the seven members of the Board of Governors, the president of the New York Fed and four other regional presidents who are They rotate every year.
These meet about eight times a year to discuss the country’s monetary policy, although the meetings can be increased if the situation so requires.
