Political | Process

Officials indicated an aggressive path ahead, with rate rises coming at each of the remaining six meetings in 2022.

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• That will bring the rate now into a range of 0.25%-0.5%. The move will correspond with a hike in the prime rate and immediately send financing costs higher for many forms of consumer borrowing and credit. Fed officials indicated the rate increases will come with slower economic growth this year.

• Along with the rate hikes, the committee also penciled in increases at each of the six remaining meetings this year, pointing to a consensus funds rate of 1.9% by year’s end.

• That is a full percentage point higher than indicated in December. The committee sees three more hikes in 2023 then none the following year.

• The rate rise was approved with only one dissent. St. Louis Fed President James Bullard wanted a 50 basis point increase.

• The committee last raised rates in December 2018, then had to backtrack the following July and begin cutting.

• In its post-meeting statement, the FOMC said it also “anticipates that ongoing increases in the target range will be appropriate.” Addressing the Fed’s nearly $9 trillion balance sheet, made up mainly of Treasury’s and mortgage-backed securities it has purchased over the years, the statement said,

• “In addition, the Committee expects to begin reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities at a coming meeting.”

• Fed Chairman Jerome Powell at his post-meeting news conference hinted that the balance sheet reduction could start in May, and said the process could be the equivalent of another rate hike this year.

• The indication of about 175 basis points in rate increases this year was a close call: The “dot plot” of individual members’ projections showed eight members expecting more than the seven hikes, while 10 thought that seven total in 2022 would be sufficient.