Fed Keeps Interest Rates Unchanged, Experts Not Surprised | Entrepreneur

March 20, 2025March 19, 2025 ~ knjohn ~ Leave a comment

Federal Reserve officials kept interest rates at a target range of 4.25% to 4.5% following the conclusion of the Federal Open Market Committee (FOMC) meeting on Wednesday.

The range has stayed the same since December when the Fed cut rates by 25 basis points or 0.25%, but the Fed indicated that reductions to the rate could occur later in the year.

“We’ll be adapting as we go,” Federal Reserve chair Jerome Powell said in a Wednesday press conference following the decision. He noted that the Fed does not need to rush to make policy adjustments and “is well positioned to wait for clarity” on President Donald Trump’s economic plans, including tariffs

Fed Decision: Officials Hold Rates Steady, Signal First Cut Is Nearer | Bloomberg

August 1, 2024July 31, 2024 ~ knjohn ~ Leave a comment

Federal Reserve Chair Jerome Powell said an interest-rate cut could come as soon as September after the US central bank voted to leave its benchmark at the highest level in more than two decades.

“The question will be whether the totality of the data, the evolving outlook, and the balance of risks are consistent with rising confidence on inflation and maintaining a solid labor market,”

Powell told reporters Wednesday. “If that test is met, a reduction in our policy rate could be on the table as soon as the next meeting in September.”

His comments followed a Federal Open Market Committee decision to leave the federal funds rate in a range of 5.25% to 5.5%, a level they have maintained since last July.

The backbone of America’s economy was just dealt a serious blow | CNN Business

May 16, 2024May 15, 2024 ~ knjohn ~ Leave a comment

US consumers could be reaching their breaking point. After dealing with elevated inflation and the highest interest rates in decades, they’re starting to rein in their spending.

Last month, retail sales were unchanged from March, when spending increased by a downwardly revised 0.6%, the Commerce Department reported on Wednesday.

April spending missed the 0.4% increase that economists had projected, according to FactSet. The figures are adjusted for seasonal swings but not inflation.

By comparison, a year ago, retail sales surged by 3%. Stripping away auto sales, April retail sales were up by 0.2% last month, matching economists’ expectations.

Fed holds interest rates steady but signals cuts ahead | BBC

March 21, 2024March 20, 2024 ~ knjohn ~ Leave a comment

The US central bank has left its key interest rate unchanged again, while it looks for more evidence that inflation is coming under control.

The decision kept the target range for the Federal Reserve’s influential rate in the range of 5.25%-5.5%, the highest in more than two decades.

The Fed is debating whether higher borrowing costs have done enough to ease the pressures pushing up prices.

Officials said they still expected to cut rates by the end of the year.

But after raising borrowing costs aggressively in response to soaring prices in 2022, the bank is proceeding cautiously.

IRS Holds Interest Rates Steady for Q2 2024 | Small Biz Trends

March 4, 2024March 3, 2024 ~ knjohn ~ Leave a comment

The Internal Revenue Service (IRS) announced as of April 1, 2024, interest rates for overpayments and underpayments will remain unchanged for the second quarter of the year. This decision reflects the IRS’s ongoing assessment of the economic landscape and its implications for individual and corporate taxpayers.

For individuals, the sustained rate is set at 8% per annum, compounded daily, for both overpayments and underpayments. This means that taxpayers who have paid more than what was owed will earn interest at this rate, while those who have underpaid their taxes will incur interest at the same rate on the outstanding amount.

Corporate taxpayers will see a differentiated structure. The general rate for corporate overpayments stands at 7%, but for the portion of a corporate overpayment exceeding $10,000, the rate is reduced to 5.5%. Conversely, the underpayment rate for corporations mirrors that of individuals at 8%, with a heightened rate of 10% applying to large corporate underpayments.

US home sales see worst year since 1995 | BBC

January 22, 2024January 21, 2024 ~ knjohn ~ Leave a comment

Home sales in the US sank to the lowest in nearly 30 years, as a sharp rise in interest rates increased costs for buyers and persuaded many potential sellers with lower rates to stay put.

Just 4.09 million homes were purchased, the fewest since 1995, as tight supply pushed prices to a new record, the National Association of Realtors said.

The organization said it expected the market to improve in 2024.

But it warned that affordability would remain an issue.

The median sale price in 2023 climbed 1% over the year, to $389,800 (£307,625), according to the NAR, which publishes the widely tracked report on sales of existing homes, which account for the bulk of purchases in the US.

The median price has jumped more than 40% since 2019, after a surge in prices during the pandemic.

Bank of England boss says interest rates close to peak | BBC News

September 8, 2023September 6, 2023 ~ knjohn ~ Leave a comment

Bank of England Governor Andrew Bailey has said interest rates are close to their peak, but that they may still have further to rise.

He told MPs “we are much nearer now to the top of the cycle” of rate rises.

The Bank has hiked rates 14 times in a row as it tries to slow the fastest pace of price rises among the world’s big economies.

It is expected to raise borrowing costs again later this month, taking the Bank rate to 5.5%.

The theory is that raising interest rates makes it more expensive to borrow money, meaning people have less to spend, reducing demand and slowing inflation, which is the rate at which prices rise.

But the Bank rate is currently at its highest level for 15 years, and inflation has remained stubbornly high.

Buckle up: The Fed is about to get tough on inflation | CNN

May 2, 2022May 1, 2022 ~ knjohn ~ Leave a comment

Last month, the Federal Reserve raised interest rates for the first time since December 2018. Now there are growing expectations that the central bank is about to dramatically step up the size and pace of its rate hikes in order to put a brake on surging consumer prices.

St. Louis Federal Reserve president James Bullard, one of the more hawkish members among the Fed’s regional bank chiefs, reiterated at an event Monday that the Fed needs to “expeditiously” raise rates in order to tamp down inflation. (Inflation hawks typically push for higher rates while so-called doves favor lower rates to stimulate growth.) Bullard suggested the Fed could raise rates by as much as 75 basis points.

Fed chair Jerome Powell has started to sound a lot more hawkish in recent weeks, but he may not want to move as aggressively as Bullard would like. But it’s clear that rates are likely to start climbing a lot higher soon.

Buckle up: The Fed is about to get tough on inflation | CNN

April 21, 2022 ~ knjohn ~ Leave a comment