gold silver Wagner Why would the Fed scale back rate hikes as core inflation continues to rise?
With the November FOMC meeting concluding tomorrow many analysts and news sources are reporting the possibility that the Federal Reserve will announce or at least give subtle hints that they might begin to scale down their aggressive stance on interest rate hikes.
Over the last five FOMC meetings, the Fed has implemented five consecutive rate hikes beginning with a ¼% rate hike in March, and a ½% rate hike in May which was followed by three consecutive ¾% rate hikes in June, July, and September. It is widely anticipated that the Fed will raise rates by ¾% for a fourth consecutive time at the conclusion of tomorrow’s FOMC meeting.
One possibility as to why the Federal Reserve is choosing to pivot its pace of rate hikes is the fact that the Federal Reserve is now losing billions of dollars based on the current benchmark interest rate of 3% to 3 ¼%. On October 25 Bloomberg news published an article titled, “Fed Is Losing Billions, Wiping Out Profits That Funded Spending”.
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