Cooling inflation has raised signals of a slowdown in the interest rate hikes. According to most economists in a Reuters poll, the Federal Reserve will end its tightening cycle after 25-basis-point hikes in February and March. It will likely hold interest rates steady for at least the rest of the year.
Last year, the Federal Reserve launched a series of seven rate hikes, bringing the benchmark rate from near zero to a range of 4.25% to 4.5%. Despite that, inflation remains above the Fed’s 2% target, leaving a slim chance of rate cuts anytime soon. Fed Vice Chair Lael Brainard pressed on staying ‘sufficiently restrictive’ for some time to curb price growth.
