Category: U.S. interest rate hikes

Major Banks See Federal Reserve Raising Interest Rates Beyond 5 Percent as Inflation ‘Refuses to Soften’

February 17, 2023
Bank of AmericaBusiness & MarketsDeutsche Bankeconomic policieseconomyFederal Reserve PolicyGoldman Sachshigh inflationinflationU.S. interest rate hikesUS
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Goldman Sachs, Deutsche Bank, the Bank of America (BofA), and other financial institutions are expecting the Federal Reserve to extend its interest-rate hikes as elevated inflation and strong employment maintain upward pressure on prices. BofA now expects a pause in interest rate hikes in July rather than earlier expectations of June. “Resurgent inflation and solid…

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How Stocks Tend to Perform If Midterm Elections Lead to Divided Government

November 8, 2022
2022 Midterm ElectionsBusiness & Marketsdivided governmenteconomyinflationMarketsPoliticsrepublican houseS&P 500 benchmarkStock ExchangesstocksU.S. interest rate hikesUS
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The U.S. midterm elections are not only an event that decides the fate of political power in Congress but also something that affects the stock markets. In a note to clients, Jim Reid, a markets strategist at Deutsche Bank, pointed out that midterm elections are one of the “best historical buy signals for equities,” according…

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Investors Rush to Safety of Cash at Fastest Pace Since Pandemic Stock Rout

November 5, 2022
Business & Marketseconomic recessioneconomyhigh inflationinflationInvestmentMarketsrecessionS&P 500stock market crashU.S. interest rate hikesUSUS Dollar
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With the Federal Reserve maintaining a hawkish stance, investors have been fleeing toward the safety of cash at a record pace. In the week through Nov. 2, investors poured in $62.1 billion into cash, a note from Bank of America (BofA) said citing EPFR Global Data. Since the beginning of October, fund flows into cash…

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Mortgage Demand Slumps Again Despite Rates Easing as Housing Downturn Intensifies

November 2, 2022
Business & MarketseconomyHome saleshousing marketMarketsmortgage applicationsmortgage demandreal estaterecessionrising mortgage ratesU.S. interest rate hikesUSUS Real Estate
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Even though mortgage rates eased down a bit, demand for mortgages fell for the week ended Oct. 28, according to data from the Mortgage Bankers Association (MBA). The Market Composite Index, which measures mortgage loan-application volume, declined by 0.5 percent on a seasonally adjusted basis for the week ended Oct. 28 when compared to a…

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Fed Playing a ‘Dangerous Game’ That May Lead to ‘Significant Recession’: Invesco Strategist

October 22, 2022
Business & Marketseconomic policieseconomic recessioneconomyFederal Reservehigh inflationinflationrecessionU.S. interest rate hikesUS
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As the Federal Reserve keeps raising interest rates in its attempt to bring down inflation, it’s running the risk of triggering a considerable economic slowdown, according to Invesco’s chief global market strategist Kristina Hooper. “When you are raising rates in 75-basis-point increments and you’re not giving any time for it to process through and make…

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Ex-Treasury Secretary Says ‘We’re in New Financial Territory’

September 28, 2022
30-year mortgageBusiness & Marketseconomic policieseconomyinflationMarketsmortgage applicationsmortgage ratesU.S. interest rate hikesU.S. treasury yieldsUS
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Lawrence Summers, the former Secretary of Treasury under the Clinton administration, has warned that home mortgage rates are set to climb even higher. “The U.S. 10-year rate just crossed above 4 percent. Mortgage rates comfortably exceed 7 percent. We are now in new financial territory,” Summers noted in a tweet on Sept. 28. The average contract rate…

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US Economic Growth Forecast Slashed as Inflation to ‘Remain at High Levels’: OECD

September 26, 2022
Business & Marketseconomic policieseconomygdp growthhigh inflationinflationOrganization for Economic Co-operation and DevelopmentU.S. interest rate hikesUS
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The Organization for Economic Co-operation and Development (OECD) now expects the United States to grow slower this year and the next, according to its September economic outlook interim report. The United States is projected to grow by 1.5 percent in 2022—a full percentage-point decrease from the June estimate of 2.5 percent—and 0.5 percent in 2023,…

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Mortgage Rates Jump to 14-Year High as Fed Delivers Jumbo Rate Hike

September 23, 2022
30-year mortgageBusiness & MarketseconomyinflationMarketsmortgage ratesreal estateU.S. interest rate hikesU.S. treasury yieldsUSUS Real Estate
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U.S. mortgage rates spiked to record highs for the fifth straight week following the Federal Reserve’s decision to raise its key interest rate. The average interest rate on a 30-year fixed-rate mortgage was 6.29 percent for the week ended Sept. 22, according to data from the mortgage lender Freddie Mac. This is the highest level…

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Inflation Can ‘Take Years, Not Months,’ to Cool Off: Former CBO Director

August 30, 2022
Business & MarketsCBOeconomyhigh inflationinflationInflation Reduction ActstagflationU.S. interest rate hikesUSUS News
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Former Congressional Budget Office Director Douglas Holtz-Eakin has warned that the high inflation rate troubling American citizens isn’t going away anytime soon and is here to stay for several years. In an interview with Fox, Holtz-Eakin cited Federal Reserve Chairman Jerome Powell’s statement on Aug. 26 about inflation. “One of the things that Powell emphasized…

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Unemployment Claims Rise More Than Expected as US Sinks into Recession

July 29, 2022
Business & Marketseconomyinflationinsured unemploymentU.S. Department of LaborU.S. interest rate hikesUSUS NewsUS Unemployment Claims
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Unemployment claims registered a fall for the most recent week, but still remained higher than expected, according to data from the U.S. Department of Labor (DoL). “In the week ended July 23, the advance figure for seasonally adjusted initial claims was 256,000, a decrease of 5,000 from the previous week’s revised level,” a July 28…

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