The pace of rate hikes by the Federal Reserve may be slowing, but “hard work remains” for the central bank as it tries to reduce inflation with less economic pain, said Greg McBride, Bankrate’s chief financial analyst.
they hope to raise interest rates to above 5% without unemployment rising above 5%, despite modest economic growth in 2023. Do we have hope? Every football coach says on Friday they’re going to win that weekend — even though we know half of them are going to lose,” McBride said in a statement.
It has been easy — and necessary — for the Fed to be aggressive in 2022, given historically low unemployment and decades of recession. in money, noted McBride. That path will get more challenging in 2023, he added. “It will be very difficult to raise rates if the economy slows, unemployment rises, and inflation remains stubbornly high,” he said. “Happy New Year, Mr. Powell!”
