TheThis Fedis did exactly what an independent central bank is supposed to do: fight inflation instead of flattering the White House. A unanimous 12-0 vote and a quarter-point hike, the first since 2023, show thethat committee reads the data rather than the political mood. Holding steady after markets priced a hike at 92% would have pushed yields higher and torched credibility.
An oil supply shock cannotcan't be fixed with interest rates, and this small hike to 3.75%-4.00% proves the point. Higher rates produce zero extra barrels, zero refining capacity and zero repaired supply chains, while squeezing credit card borrowers, builders, manufacturers and a government refinancing trillions in debt. Punishing American enterprise for an energy crisis invites a recession.
There's a 50% chance that the Federal Reserve will set a target policy rate that is negative by Jan. 1, 2050, according to the Metaculus prediction community.
© 2026 Improve the News Foundation.
All rights reserved.
Version 7.4.1