Fed Raises Benchmark Interest Rate

Global Silicone Network March 17th: At 02:00 in the morning, the Federal Reserve raised its benchmark interest rate by 25 basis points to a range of 0.25%-0.50%, the first rate hike since December 2018. In a statement, the Fed said inflation remained high, reflecting supply-demand imbalances related to the pandemic, higher energy prices, and broader price pressures. The conflict in Ukraine could create inflationary pressures and slow economic growth.

Institutional analysis: Since 1993, the United States has experienced a total of 4 rounds of interest rate hikes and rate cuts. This time, the timing of interest rate hikes in March is indeed a bit late, and the rate of subsequent interest rate hikes may be accelerated; the high inflation expectations this time have caused real interest rates to fall rapidly, and the real interest rate of 10-year U.S. bonds may rise rapidly.