November 2, 2022
The Federal Reserve just raised interest rates by another 0.75%.
This marks the fourth increase of 0.75% in a row. We haven’t seen that in decades.
I have reported on this page many times the biggest tool The Fed has to deal with inflation is interest rates. Interest rates determine the cost to borrow money for you, me and for businesses whether that’s a car loan, your credit card rate, your variable rate mortgage or certain private loans. When interest rates are low — money is cheap to borrow like it’s been for several years. That gives lots of people and businesses the ability to spend – stimulating the economy. But all that spending can lead to too much money in circulation and an increase in inflation. And that’s what we’re seeing.
The Federal Reserve will be meeting one more time in December and the Chairman said it’s likely that interest rate will go up again.
