(Reuters) – Federal Reserve policymakers have pushed U.S. borrowing costs up faster this year than at any time since 1980, after a government report showed inflation continued to sizzle.
The U.S. Commerce Department reported that the Fed’s 2 percent personal consumption expenditures price index rose 6.2 percent year over year in August. Underlying inflation, measured by core data excluding food and energy prices, rose 4.9% from 4.7% previously.
Even before the report, the Fed was widely expected to raise rates for the fourth time in a row 75 basis points when officials meet early next month.
So far this year, policymakers have raised the benchmark policy rate by 3 percentage points to a range of 3%-3. 25%, and said they expected to raise another 1.5 percentage points early next year before leaving rates at that level 2023 to slow the economy and weaken the Unrealized price pressure has been so high for 40 years.
“What we need to see is a sequential decline in inflation, and we just haven’t seen it yet,” said Art Hogan, chief market strategist at B. Riley Wealth.