The Federal Reserve announced its fourth consecutive 75-basis-point interest rate hike yesterday. While Jerome Powell hinted at potentially slower rate hikes in the future, he also quelled the optimism by saying that the central bank has “a ways to go” in tightening policy enough to bring inflation down to its 2% target.
With Powell not divulging what level of the so-called terminal rate will be, except that it is not coming down anytime soon and “that the ultimate level of interest rates will be higher” than once expected, the markets sank promptly and significantly. All the key market indices posted sharp intraday declines, with the Nasdaq Composite losing as much as 366.05 points or 3.4%.
