The Fed announced a 75 basis-point interest rate hike today for the third consecutive time. Moreover, the central bank officials now expect the key rate to end 2022 at a range of 4.25% to 4.5%, which suggests another outsize rate hike in its November meeting.
Goldman Sachs (GS) recently cut its forecast for 2023 GDP to 1.1%, down from its prior projection of 1.5%, as aggressive rate hikes will likely push the jobless rate higher than expected. Moreover, with the world’s largest economies slowing, the World Bank has warned that even a “moderate hit to the global economy over the next year could tip it into recession.”
