The US Central Bank anticipates that the key rates will increase to 0.9% at the end of 2022, at 1.6% late 2023 with two increases in the year, then at 2.1% in 2024 with two increases Also and finally 2.5% in the long run.
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MAJOR TURN OF THE Fed: The US Central Bank announced on Wednesday 15 December that it provided for 2022 three interest rate increases at the end of the two meeting days of its Monetary Policy Committee. The Fed’s key rates, which set the rent for short-term money, remain fixed between zero and 0.25 since the beginning of the CVIV-19 pandemic in March 2020, but the path of faster standardization What expected is traced: Fed members provide that the key rates will increase to 0.9% at the end of 2022, a significant figure to their September forecast, which was 0.4%. End 2023, the rent of money would rise to 1.6% with two increases in the year, then 2.1% in 2024 (two increases too) and 2.5% in the long run.
This turnaround is explained by the rise in inflation, which laminates the purchasing power of the Americans and turns into a thorn for the presidency of Joe Biden. Long described as a transient or transient, it settles in the United States: rising prices reached 6.8% in November, never-seen since 1982, and now concerns all economic sectors. Originally, inflation was confined to bottlenecks that hindered the restart of the economy (freight, semiconductors, raw materials) but this phenomenon has created “larger and more sustainable than anticipated” problems , acknowledged the President of the Fed President, Jerome Powell.
The fear of an inflation-wage spiral is not completely excluded, while the unemployment rate fell more quickly than expected, at 4.2% in November, and that labor shortage is felt. “Wages have been dynamic but, so far, the increase in wages [which reached 4.8% year-on-year in November] has not been a major contributor at the level of inflation,” said M . Powell, the “so far” being an important caveat. “We are attentive to a rise in wages greater than productivity can put up on the rise on inflation,” he continued.
m. Powell, which was renamed by Joe Biden for a second four-year term, as of the February 1, is very careful about the economic jolts associated with the pandemic. The good use of employment, measured by the unemployment rate, masks a less satisfactory phenomenon, the decline in the participation rate of Americans to employment: it can be explained by the aging of the population and the reluctance of One part of the Americans to resume the path of employment, for fear of CVIV-19 and / or because they have financial reserves accumulated during the crisis, for lack of being able to spend and through social and tax transfers. This shortage can lead to inflationary pressures.
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