00:00The Federal Reserve's interest rates on Wednesday, September 16, and flagged further increases in borrowing costs in coming months,
00:09with new U.S. Central Bank Chief Kevin Walsh joining a unanimous decision that effectively acknowledged the Trump administration's inability
00:17so far to control inflation,
00:19while President Donald Trump had promised to lower prices on his watch, the combined impact of his global import tariff,
00:27and energy shock following the start of the U.S.-Israeli war, with Iran and capital spending from the artificial intelligence
00:35boom,
00:35has kept price pressures intense enough that the Fed felt it needed to raise the benchmark overnight interest rate by
00:43a quarter of a percentage point to the 3.75% to 4.00% range.
00:53New policy projections showed 16 of 18 policymakers anticipate at least one more quarter percentage point high by the end
01:00of this year,
01:01with only two of them seeing rates remaining stable from here.
01:05Walsh apparently again did not submit a rate projection.
01:08He's the first policy shift under the new Fed chief, who took office in late May after being selected by
01:13Trump with an expectation that he would cut rates.
01:16Federal Reserve Chairman Kevin Walsh has said in a press conference following the Fed meeting that when it came to
01:22lifting rates, inflation remains elevated.
01:25Economic activity is expanding at a solid pace.
01:29While uncertainty remains elevated, owing in part to geopolitical developments, domestic spending has been resilient.
01:38Productivity growth, strong.
01:41And capital investment is robust.
01:43Job gains have kept pace with the workforce, and the unemployment rate has changed little.
01:50But inflation remains elevated.
01:53Today's policy action will support a timelier return to the committee's 2% goal.
02:00This committee will deliver price stability.
02:03Market bets on a rate hike at the Fed's next meeting in late October
02:06ticked higher to 56.5% from 54% prior to the hike, according to CME Group's Fed Watch tool.
02:14The Fed's new policy statement and economic projections show a central bank opening the door on tighter monetary policy through
02:21next year,
02:21with a policy rate rising to 4 to 4.25% range by the end of this year and ending
02:272027 at the same level.
02:29The rate increase was announced less than two months ahead of midterm elections that will determine whether Trump's Republicans
02:36maintained control of Congress for the final two years of his presidency.
02:40The Republicans are facing an uphill battle with voters angry about gasoline prices that are about a third higher than
02:46a year ago
02:47and interest rates on home mortgages that have been rising steadily this year.
02:51The average rate on a 30-year fixed-rate mortgage is approaching 7%.
02:57Policymakers' new quarterly economic projections marked up estimates of inflation,
03:01as measured by the personal consumption expenditure's price index,
03:05to 3.7% versus the 3.6% projected at the Fed's June meeting.
03:10Inflation is not projected to return to the 2% target until 2029, a year later than previously expected.
03:17Economic growth was marked up slightly from 2.2% to 2.3%,
03:22while the unemployment rate is seen ending the year at 4.1% versus the 4.3% projected in
03:28June.
03:29WASH has pledged to lower inflation back to 2% clearly and at sufficient speed by raising rates as needed.
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