Fed officials say tapering ‘may soon be warranted’ and interest rates rise penciled in for 2022. Powell says announcement on tapering bond purchases could come in November. The formal announcement could come at the Fed’s Nov. 2-3 meeting, barring a major setback for the economy or another coronavirus outbreak, Powell indicated. In updated projections, the Fed also penciled in three interest-rate hikes in 2023 and three more in 2024, bringing the benchmark interest rate up to 1.8% by the end of the period.
The fed stuck with its forecast that inflation would fade back toward 2.2% by next year. The central bank expects the rate of inflation to top out around 4.2% in 2021, according to its new projections. Growth in the U.S. economy, for its part, is expected to slow from an estimated 5.9% this year to 3.8% in 2022 and 2.5% in 2023. The economy’s long-term growth potential is viewed as about 2.5% a year. The unemployment rate is also forecast to fall to 3.5% by 2023 and match the 50-year low that existed prior to the onset of the pandemic. The unemployment rate is also forecast to fall to 3.5% by 2023 and match the 50-year low that existed prior to the onset of the pandemic.
The fed stuck with its forecast that inflation would fade back toward 2.2% by next year. The central bank expects the rate of inflation to top out around 4.2% in 2021, according to its new projections. Growth in the U.S. economy, for its part, is expected to slow from an estimated 5.9% this year to 3.8% in 2022 and 2.5% in 2023. The economy’s long-term growth potential is viewed as about 2.5% a year. The unemployment rate is also forecast to fall to 3.5% by 2023 and match the 50-year low that existed prior to the onset of the pandemic. The unemployment rate is also forecast to fall to 3.5% by 2023 and match the 50-year low that existed prior to the onset of the pandemic.
