The Federal Reserve is expected to announce its interest rate decision on Wednesday, November 7, 2024. The Federal Open Market Committee (FOMC) is widely expected to raise the federal funds rate by 25 basis points to a range of 5.50% to 5.75%. This would mark the 12th consecutive rate hike since the Fed began raising rates in March 2022.
The decision to raise rates comes as the U.S. economy continues to show signs of strength. The unemployment rate remains low, and consumer spending is robust. However, inflation remains elevated, and the Fed is concerned that it could continue to rise if it does not take steps to cool the economy.
The Fed’s rate hike is expected to have a number of effects on the economy. It will make it more expensive for businesses and consumers to borrow money. This could lead to slower economic growth and a decline in job creation. However, it could also help to bring inflation back down to the Fed’s target of 2%.
The Fed’s rate hike is also likely to have an impact on the stock market. Investors are generally concerned about the possibility of a recession, and a rate hike could increase those concerns. As a result, the stock market could see a decline in the days following the Fed’s announcement.
It is important to note that the Fed’s rate hike is not a guarantee. The FOMC could still decide to pause or even cut rates if the economy weakens. However, the current consensus is that the Fed will raise rates by 25 basis points on November 7.
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