The majority of economists polled by Reuters predict that the U.S. Federal Reserve will not raise interest rates again, and they expect the central bank to wait until at least the end of March before cutting them, as the probability of a recession within a year falls to its lowest level since September 2022.
The recent rise in interest rates is causing credit to become more expensive and harder to obtain, which will have significant implications for various sectors of the economy such as real estate, automobiles, finance/banks, and venture capital/tech companies. Rising rates also affect the fair value of assets, presenting both opportunities and risks for investors.
Experts are divided on whether the US Federal Reserve should raise its interest rate target to 3% to combat inflation and cushion against recessions, with some arguing that raising inflation targets would be futile.
Former St. Louis Fed chief James Bullard warns that stronger economic growth in the US may necessitate higher interest rates to combat inflation.
Two Federal Reserve officials suggest that interest-rate increases may be coming to an end, but one of them believes that further hikes may still be necessary depending on inflation trends.
Boston Federal Reserve President Susan Collins stated that the central bank may require additional interest rate hikes and will likely maintain elevated rates for an extended period, even if no further increases occur in the near future.
The recent increase in the average interest rate for refinancing has been influenced by the Federal Reserve's interest rate hikes and the effects of inflation.
The president of the Federal Reserve Bank of Philadelphia believes that the US central bank has already raised interest rates enough to bring inflation down to pre-pandemic levels of around 2%.
Spending on AI could boost GDP and productivity, while also potentially raising interest rates in the coming years.
U.S. economic growth, outpacing other countries, may pose global risks if the Federal Reserve is forced to raise interest rates higher than expected, potentially leading to financial tightening and ripple effects in emerging markets.
Cleveland Federal Reserve Bank President Loretta Mester believes that beating inflation will likely require one more interest-rate hike in the U.S. and then pausing for a while, although she may reassess her previous view of rate cuts starting in late 2024, and she aims to set policy so that inflation reaches the Fed's 2% goal by the end of 2025 to prevent further economic harm.
US Treasuries are attracting investors despite the possibility of interest rate hikes, as the potential income from high yields outweighs the potential losses from rate increases.
The former president of the Boston Fed suggests that the Federal Reserve can stop raising interest rates if the labor market and economic growth continue to slow at the current pace.
Economists at the Chicago Fed argue that recent rate increases have brought inflation on a path to 2% without causing a recession, creating a "goldilocks" scenario for risk-taking in financial markets.
Federal Reserve policymakers are not eager to raise interest rates, but they are cautious about declaring victory as they monitor data such as inflation and job growth; most do not expect a rate hike at the upcoming policy-setting meeting.
Soaring interest rates have increased the popularity of fixed-income investments like bonds and money market funds in the U.S., but investors should be prepared for higher taxes on the income generated from these assets.
The Wall Street Journal reports a notable shift in the stance of Federal Reserve officials regarding interest rates, with some officials now seeing risks as more balanced due to easing inflation and a less overheated labor market, which could impact the timing of future rate hikes. In other news, consumer credit growth slows in July, China and Japan reduce holdings of U.S. Treasury securities to record lows, and Russia's annual inflation rate reached 5.2% in August 2023.
Investors are growing increasingly concerned about the ballooning U.S. federal deficit and its potential impact on the bond market's ability to finance the shortfall at current interest rates, according to Yardeni Research.
Rising energy costs are predicted to contribute to an increase in inflation rate, but it is unlikely to prompt the Federal Reserve to raise interest rates, though there may be another rate hike in the future.
J.P.Morgan Asset Management predicts that there will be no more interest rate hikes from the U.S. Federal Reserve due to downward-trending inflation data.
The European Central Bank has implemented its 10th consecutive interest rate increase in an attempt to combat high inflation, although there are concerns that higher borrowing costs could lead to a recession; however, the increase may have a negative impact on consumer and business spending, particularly in the real estate market.
The European Central Bank has raised its main interest rate for the 10th consecutive time to tackle inflation, but indicated that further hikes may be paused for now, causing the euro to fall and European stocks to rally.
New research suggests that elevated interest rates may not have been the main cause of the decline in inflation, sparking a debate about whether the Federal Reserve needs to raise rates again.
Goldman Sachs predicts that the Federal Reserve will not raise interest rates at its upcoming annual meeting due to favorable inflation news and projected economic growth, but they expect a further hike later in the year.
A survey conducted by Bloomberg shows that most economists expect the Federal Reserve to hold interest rates steady until May and project one additional rate increase this year, although they do not believe the Fed will actually implement another increase.
The Federal Reserve is expected to signal that another rate hike may be necessary due to strong economic growth and inflation metrics, creating a difference of opinion between the equity and bond markets.
The Federal Reserve is leaving its key interest rate unchanged as it moderates its fight against inflation, but plans to raise rates once more this year, as policymakers remain concerned about inflation not falling fast enough.
The US Federal Reserve holds interest rates steady at 5.25% to 5.50%, projects higher rates for next year, and expects stronger economic growth, causing a slight drop in Bitcoin's price.
Almost 40% of people have increased their cash holdings since interest rate hikes started, as they seek to take advantage of current interest rates.
The U.S. Federal Reserve kept interest rates steady but left room for potential rate hikes, as they see progress in fighting inflation and aim to bring it down to the target level of 2 percent; however, officials projected a higher growth rate of 2.1 percent for this year and suggested that core inflation will hit 3.7 percent this year before falling in 2024 and reaching the target range by 2026.
The Federal Reserve has indicated that interest rates will remain "higher for longer," potentially for at least three more years, in order to sustain economic growth and combat inflation.
The Turkish central bank has increased interest rates by five points to 30% in an effort to combat soaring inflation, which is above expectations, and the bank suggests that more rate hikes are likely in the future.
Stocks may not be as negatively impacted by higher interest rates as some fear, as the Federal Reserve's forecast of sustained economic growth justifies the higher rates and could lead to increased stock valuations.
