On March 20, 2024 the Federal Reserve announced that interest rates would remain steady at 5.25%-5.50% for the time being. This decision mirrors the outcome of their first meeting in 2024, marking a conservative approach to interest rates for the year.
Throughout 2022-2023, inflation was at its highest. To combat this, the Fed increased rates 11 times which had the effect of lowering inflation. The rates increased borrowing costs for homes, vehicles, and consumer credit. As of this writing, inflation is currently down to 3.2%, a significant improvement from where we were in January 2023, which was 6.4%.
Based on the current state of the US inflation, experts suggest that we are shifting in the right direction, with a possible cut in interest rates coming later this year. If the rate cuts occur, historically it leads to lower borrowing costs for consumers and businesses, potentially stimulating increased economic activity across the financial markets.
Speaking of the financial markets, they’ve been performing well, especially crypto. On March 8th, 2024, Bitcoin set new records, blasting past its previous all-time high to $70,000. The global crypto market cap is currently at $2.53 Trillion, a +196% increase from last year.
As we anticipate the next Federal Reserve meeting, everyone is eagerly waiting to see if the Federal Reserve will cut rates.
To learn more about interest rates and how it affects you, read the article below.
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