October 29, 2023
To raise your interest rates … or not to raise your interest rates.
That is the question the Federal Reserve is going to be weighing next week.
Since July the fed has kept interest rates steady at between 5.25-5.5% which is the highest it’s been in 22 years. Even though they’ve met several times since July, the fed has decided not to raise or cut the rate and instead just wait and see what the data shows.
But next week they’re meeting again to figure out what to do next.
And that’s going to depend on several factors.
If you’ve been following me and reading daily my news girl news roundup email – which I highly suggest you sign yourself up for if you haven’t already done it – you are well aware of all the factors the federal reserve is going use to base its decision.
Factors like the consumer price index – which I told you about in this video and most people use as an inflation gauge, the producer price index – which measures the wholesale costs of goods and services, the personal consumption expenditures price index – which measures u-s consumer spending – and the unemployment numbers – all of which I’ve been covering in my News Girl News Roundup email — and of course the GDP report which I talked about in this video yesterday.
All those things combined showed on the down side — inflation is being really stubborn and sitting at 3.7% which is well above the fed’s target 2% target, but on the up side, unemployment is still very low, our jobs market is extremely strong, consumer spending is “up and outpacing inflation” and the GDP had a blockbuster third quarter.
So what is the fed going to do next week? Well, they’ve signaled they will not increase or decrease the interest rate. They’ll keep it the same. Last week the Federal Reserve chairman said the rates haven’t been high long enough for them to really take hold on the economy to get his inflation down. So next week they may be inclined just pump the brakes for another month. But you have to understand — just because the fed might not raise rates this month doesn’t mean they won’t raise them in December when they meet one last time in 2023.
