Opinion | Raising interest rates will curb inflation and maintain Fed credibility

Live updates

1. 3h ago

   Economists expect Federal Reserve interest rate hike this Wednesday

   The Federal Reserve is preparing to raise interest rates to combat persistent inflation. Economists polled by Reuters indicate a rate hike is likely this Wednesday, with at least one additional increase expected to follow. While some analysts argue these moves are necessary to curb inflation and protect the credibility of the central bank, others question the effectiveness of the strategy. The potential shift impacts consumer finances and prompts advice on where to allocate savings.

   Why it matters

   The Federal Reserve uses interest rate adjustments to manage economic stability and price levels. Persistent inflation forces the bank to balance the need for price control against the risk of slowing economic growth.

   What is confirmed

   • The Federal Reserve is preparing to raise interest rates.
   • Inflation persists as a driver for potential rate increases.

   Still unconfirmed

   • A rate hike will occur this Wednesday.
   • At least one more rate hike will follow the initial increase.
   • Raising interest rates will curb inflation and maintain Fed credibility.

   What to watch next

   • The Federal Reserve's official rate decision on Wednesday
   • Data indicating if inflation persists after the hike
   Sources used for this update (5)

   1. CNN — The Fed is preparing to raise rates. What if it doesn’t work?
   2. Reuters — Fed rate hike on Wednesday now likely, say economists, and at least one more to follow: Reuters Poll
   3. CNBC — The Fed is likely to raise interest rates as inflation persists. What that means for consumers
   4. The Washington Post — Opinion | Raising interest rates will curb inflation and maintain Fed credibility
   5. CBS News — The Fed may raise interest rates this week. Here's where you should keep your money if that happens.
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