Kevin Carmichael: Financial system can 'absorb' shock of higher interest rates, Canada's banking regulator says
The statement said the Fed’s balance sheet, which soared to about US$9 trillion as the central bank tried to shelter the economy from the COVID-19 pandemic, would be allowed to decline by US$47.5 billion per month in June, July and August and the reduction would increase to as much as $95 billion per month in September.
Policymakers did not issue fresh economic projections after this week’s meeting, but data since their last gathering in March have given little sense that inflation, wage growth, or a torrid pace of hiring had begun to slow. Fed Chair Jerome Powell is scheduled to hold a news conference at 2:30 p.m. EDT to elaborate on the policy statement and economic outlook.
So now all of those who purchased homes at inflated prices will be crushed by the weight of escalating interest rates. I’ve see this scenario play out before in the late 1970s. It ended in high unemployment and recession. That’s where we’re headed.
We are next in June.
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