The Federal Reserve is widely expected to raise its fed funds target rate by a half-percentage point Wednesday, but investors will be more focused on whether it signals it could get even tougher with future rate hikes.
The Fed also is expected to announce the start of a program to wind down its roughly $9 trillion balance sheet by $95 billion a month, starting in June. The 50-basis-point hike would put the fed funds target rate range at 0.75% to 1%. A basis point equals 0.01%.
That target rate after this week’s boost would be well off zero, but way below market expectations for a funds rate above 2.8% by year-end.
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LIVE: Federal Reserve Chairman Jerome Powell speaks on interest rate decision — 5/4/22
