Central banks are intent on driving the world economy perilously close to a recession.
Late to see the worst inflation in four decades coming, and then slow to crack down on it, the Federal Reserve and its peers around the globe now make no secret about their determination to win the fight against soaring prices—even at the cost of seeing their economies expand more slowly or even shrink.
About 90 central banks have raised interest rates this year, and half of them have hiked by at least 75 basis points in one shot. Many did so more than once, in what Bank of America Corp. chief economist Ethan Harris labels “a competition to see who can hike faster.”
The result is the broadest tightening of monetary policy in 15 years—a decisive departure from the cheap-money era ushered in by the 2008 financial crisis, which many economists and investors had come to view as the new normal. The current quarter will see the biggest rate hikes by major central banks since 1980, according to JPMorgan Chase & Co., and it won’t stop there.
On Sept. 21, the Fed raised its key rate by three-quarters of a percent, responding to inflation that topped 8% in August. Sweden lifted by a full point the day earlier as banks across Europe move to tighten credit conditions.
Bu hikaye Bloomberg Businessweek US dergisinin September 26, 2022 sayısından alınmıştır.
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Bu hikaye Bloomberg Businessweek US dergisinin September 26, 2022 sayısından alınmıştır.
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