Why Investors Can Ignore the Fed's Interest Rate Decision This Week
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The Federal Reserve's third Federal Open Market Committee (FOMC) meeting of 2024 is underway. During the meetings, the central bank strategizes its monetary policy, which routinely sends the markets into a frenzy over interest rate speculation.
Expectations for this meeting, which will account for both the April and May FOMC gatherings, are not particularly high thanks in part to lingering inflation. But, if there’s one thing investors should keep in mind ahead of any Fed announcement, it’s that it is perfectly okay to ignore whatever is said.
With each meeting, investors find themselves on the edges of their seats thanks to the interest rate-hiking campaign the Fed launched over two years ago in its attempt to quell unbridled consumer prices. Raising interest rates to the highest level in nearly two decades made it more expensive for banks to borrow money, beginning a chain reaction of events at the end of which the American consumer was more incentivized to save their money rather than spend it, thus helping to slow down the economy and lower inflation.
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