Fed Raises Rates by 75 Basis Points

The video discusses the Federal Reserve's forecasts for the Fed funds rate, predicting it to be 3.4% by the end of 2022, 3.8% in 2023, and 3.4% in 2024. The Fed no longer expects the labor market to remain strong and anticipates unemployment to rise to 3.7% in 2022, 3.9% in 2023, and 4.1% in 2024. Despite these changes, the Fed does not forecast a recession this year. Inflation is expected to rise to 5.2% in 2022 but decrease to 2.6% in 2023 and 2.2% in 2024. The video also highlights the impact of the Russian invasion of Ukraine on inflation and global economic activity. Lastly, it notes a dissent by Esther George, who preferred a smaller interest rate increase.

What is the Federal Reserve's target for the Fed funds rate by the end of 2023?

• 3.4%

• 3.8%

• 4.0%

• 4.2%

According to the Fed, what is the expected unemployment rate in 2024?

• 3.6%

• 4.1%

• 3.7%

• 3.9%

What is the current headline inflation rate as mentioned in the transcript?

• 6.3%

• 5.2%

• 2.6%

• 2.2%

Which event is cited as creating additional upward pressure on inflation?

• Higher energy prices

• The pandemic

• Russian invasion of Ukraine

• Supply chain disruptions

What is the expected economic growth rate for the U.S. in 2023?

• 2.0%

• 1.9%

• 1.7%

• 1.0%