Nashville, Tenn. (WTVF) – Many were greeted to a cold and snowy morning on Wednesday.
Coincidentally, that same day, Fed Chair Jerome Powell said that something even colder was brewing.
“Inflation data obtained over the past three months show a welcome deceleration in the pace of monthly growth,” he said.
But he cautioned that the victory over inflation is not yet complete.
“While recent developments are encouraging, we will need more evidence to be confident that inflation is on a sustained downward trend,” Powell said.
this time, the Fed hikes interest rates by a quarter point – The lowest increase since last March.
The news was a welcome surprise for Wall Street, which climbed to its highest since last summer.
But some people said they just aren’t feeling the cool down from the jet.
“I actually moved here from Chicago about a year and a half ago. And in that short amount of time I can say that it feels like Chicago here now; the bus, the cost of rent, the gas has gone up a lot. A small amount,” said shopper Danielle Stortz.
Economists said it will take time for people to feel relief in their pockets.
“I think as consumers we still need to be prepared to see prices go up, maybe not as quickly, but prices will definitely stay high and over time,” said Cristiano Manfrey, professor at Graziadio Business School. Will grow.”
The Fed is targeting a 2% interest rate and experts say the road to there will be a long one.
Manfrey said, “Even when inflation is slowing, prices will still go up. So, they’ll go up less quickly, but they’ll still go up.”
And while inflation tends to go down, an interest rate hike generally means that it will be more expensive to borrow money. Right now, credit card interest rates are at historic highs with an average interest rate of 20%.
The Fed says that more interest rate hikes may be needed in the future. The next decision will be in March.
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