Jerome Powell’s Fed announced that it had left the fed funds target unchanged at the range of zero to 0.25%, indicating however that rates could be raised as early as 2023, after saying in March that it would not see the need for any monetary tightening at least until 2024.
From the dot plot – a document that indicates the expectations of each member of the FOMC, the monetary policy arm of the Fed – it emerged that the expectations of the US central bank are, on average, of two rate hikes in 2023.
On the other hand, the Fed has revised upwards the estimates on inflation growth to + 3.4% this year, well above the + 2.4% expected in the previous outlook.
The core component of inflation measured by the PCE (personal spending index) is now expected to grow by 3% in 2021, more than the + 2.2% expected in March; for 2022, the core PCE is expected to rise by + 2.1%.