The Fed Is Expected To Hike Rates Further, According to a Bloomberg’s Survey of Economists

114
SHARE
Jerome Powell Chair of The Federal Reserve of the United States
Jerome Powell Chair of The Federal Reserve of the United States

The Fed is expected to hike rates further and drag the global economy into a recession, according to Bloomberg’s survey of economists.

That comes amid expectations for another aggressive Fed rate increase next week, as central bankers scramble to get a lid on sky-high inflation.

The survey of 40 economists found that the Fed is widely expected to go for a fourth consecutive rate hike of 75 basis points Wednesday at the Federal Open Markets Committee meeting. It’s expected to be followed by a half-point rate hike in December and two quarter-point increases in early 2023.

That would bringing the fed funds target range to 4.75% to 5% from the current rate of 3% to 3.25%.

Fed officials will be skittish about a pivoting monetary policy until inflation shows clear signs of easing, economists said.

That has raised concern that the hawkishness is going overboard, with 75% of surveyed economists seeing the Fed triggering a US recession within the next two years, and two-thirds expecting a global recession in that time.