Inflation, student loan forgiveness lead biggest money stories of year
Inflation and layoffs were some of the biggest finance topics of 2022. What does this say about the U.S. economy going into 2023?
Just the FAQs, USA TODAY
The Federal Reserve is expected to raise interest rates by half a percentage point at the end of its two-day policy meeting on Wednesday to continue its fight against inflation.
Inflation has eased to 7.1% in the 12 months to November from a blistering 9.1% pace in June, which is giving the Fed breathing room to shrink the size of its rate hikes. However, the Fed’s still a long way from its 2% inflation goal, which means this is unlikely to be the last rate increase, economists say.
The Fed has already raised rates six times this year to a range between 3.75% and 4% from near zero at the start of the year. The last four increases were supersized at 0.75 percentage point each. With another half-point hike expected, the cumulative increase to date would rank among the most aggressive increases since the 1980s to try to tame the highest inflation in 40 years.
Along with an expected rate hike, the central bank will release its summary of economic projections for this year, 2023, and the subsequent two years, as well as over the longer run. The Fed releases these projections four times each year.
Little relief for those in debt: Fed poised to announce a smaller rate hike but impact still looms large
Most economists expect the Fed will raise its median 2023 inflation forecast as well as the level it sees its short-term benchmark fed funds interest rate to be.
The Fed’s decision is announced at 2 p.m. ET on Wednesday.
— Elisabeth Buchwald
Fed Chairman Jerome Powell’s media conference will begin at 2:30 p.m. ET on Wednesday. USA TODAY economics reporter Paul Davidson will cover the event in person.
— Elisabeth Buchwald
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Elisabeth Buchwald is a personal finance and markets correspondent for USA TODAY. You can follow her on Twitter @BuchElisabeth and sign up for our Daily Money newsletter here.
Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@usatoday.com.
Paul Davidson is economics correspondent for USA TODAY.
