The United States Federal Reserve (Fed), which raised interest rates for the fourth consecutive day on Thursday (Nov. 3), hinted that it might slow the rate at which it raises rates in the future.
Jerome Powell, the head of the US Federal Reserve, stated that this might occur as early as December or January, suggesting that future rate increases might be more gradual.
With the most recent increase of 0.75 percentage points, the Fed’s benchmark rate has increased from almost zero in March to a range of 3.75 to 4 percent, which is its highest level since 2008.
Although the increase was as expected by economists, the stock market nevertheless fell when Mr. Powell stated that the Fed still has “some ways to go” in its policy cycle and that it was premature to consider a halt as rates could peak at higher levels than previously believed.
On Thursday, economists told TODAY that even though the rate of increase is slowing, households here would eventually have to cope with even higher mortgage or auto loan payments, and businesses would have to pay higher borrowing charges.
“There is still a long way to go. The final level of interest rates will likely be higher than anticipated, according to data that came in since our most recent meeting, he said.
According to economic forecasts from the last Fed meeting in September, the peak Fed rate would be 4.75 percent, said senior rates strategist Eugene Leow of DBS Bank in a note to investors.
