Federal Reserve Announces Largest Fed Funds Rate Hike in Nearly 30 Years
On Monday, June 15, 2022, the Federal Reserve issued a Federal Open Market Committee (FOMC) statement announcing decisions to raise the target range for the federal funds rate to 1-1/2 to 1-3/4 percent. News of the 0.75% hike — the largest increase since 1994, comes just over one month after the May 4th increase and announced anticipation of ongoing increases as the FOMC seeks to achieve a maximum employment and inflation of 2% over the longer run. What appears to be an uptick in overall economic activity, after edging down in the 1st quarter of 2022; robust job gains in recent months; and the continued low unemployment rate contributed to the Fed’s decision.
In conjunction with the June 14-15 FOMC meeting, the Federal Reserve Board and the FOMC released a summary of economic projections by FOMC participants, noting that “each participant’s projections were based on information available at the time of the meeting, together with her or his assessment of appropriate monetary policy—including a path for the federal funds rate and its longer-run value—and assumptions about other factors likely to affect economic outcomes.”
Fed’s Economic Projections: https://www.federalreserve.gov/monetarypolicy/fomcprojtabl20220615.htm