The Fed May Slow Down Its Rate Hikes, But Investors Shouldn’t Celebrate Yet
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The Federal Reserve raised its benchmark interest rate by another 0.75% Wednesday and signaled that hikes could be smaller moving forward. A policy shift could be good news for the stock market, but investors shouldn’t expect a major change anytime soon.
The latest rate hike brings the Fed’s benchmark federal funds rate to a target range of between 3.75% and 4%.
The central bank said in a news release it would take “the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments” into account when determining the pace of future rate increases.