The Federal Reserve is expected to confirm plans this week for an interest rate hike for March as officials look to address the decades-high inflation hammering American consumers.
for March as officials look to address the decades-high inflation hammering American consumers.
Aside from the rate hikes, the Fed is also expected to provide an update on its plans to trim its $9 trillion balance sheet, which doubled during the pandemic as the bank stepped up bond purchases. The S&P 500 Index entered correction territory, defined as a 10% decline from its most recent high, during the wild day of trading before posting a modest gain. The tech-heavy Nasdaq index experienced a similar swing.Investors have looked to reduce their holdings of risky assets, including leading cryptocurrencies such as bitcoin, ahead of the Fed’s expected hawkish turn. Higher interest rates make borrowing more expensive for consumers and businesses, likely slowing economic growth.
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