Under the influence of many factors such as the successive major international events that have had a strong impact on the globalized economy, the excessive bailout policies of the US government, and the misjudgment of the Federal Reserve, the US consumer price index in May still increased by as high as 8.6% , which hit a 41-year high. It also prompted the Federal Reserve to decide a one-time rate hike of 3 yards (0.75%) at its June meeting, which is the largest rate hike since 1994. It obviously wants to send a clear signal to the market to combat inflation.
The Fed's decision was right, but company banner design it came too late While this hawkish move is undoubtedly correct, it came too late, leaving the global economic outlook with great uncertainty. Because the Fed may not be able to quickly bring down inflation from the demand side smoothly, but if the supply-side shock persists, the nightmare of stagnant inflation in the 1970s may return. Even if the Fed resorts to strong measures to continue to raise interest rates by more than a yard after the next few open market operations meetings to quell the overheated economy and accelerate the slowdown in price growth, it will still result in a hard landing for the U.S. and world economies.
that is, the risk of a sharp recession. First of all, it is worth pointing out that the current inflation is often compared to the 1970s, but the current situation is still considered to be less serious, so although the Fed must quickly turn around and send a signal to the market with a tough stance . But the rate of interest rate hikes will not need to be like Fed Chairman Volcker in the 1980s to raise interest rates to nearly 20%, in exchange for the economic downturn to solve the inflation problem.