The Fed operates on the principle that once inflation gets over a certain point, the only way to deal with it is to raise interest rates, regardless of the source of the inflation. This is shortsighted.Speaking of higher interest rates.
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Federal Reserve hikes key rate for 1st time in 3 years, defying Trump demands for a cut
The Federal Reserve raised its benchmark interest rate Wednesday for the first time since 2023 in an effort to quell stubbornly high inflation.kmbc.com
The reason higher interest rates helped bring down Biden induced inflation is because raising rates took money out of the economy that had been flooded into it without an increase in economic expansion. Our economy is expanding and taking money out of it will slow this. The cause of our current inflation is known: the rising cost of energy due to wars. It is self correcting, for the most part, once wars end or other routes are established to move energy. Rates should be left alone or even lowered, in my opinion, but won't be if the Fed keeps employing outdated models.