Slowing U.S. wage growth in last quarter of 2022 may reduce need for larger interest rate hikes, experts say | amNewYork

Federal Reserve Chair Jerome Powell had cited the growth of wages and labor costs as a major factor in the decision to raise interest rates to combat the dangerous economic side effects of inflation.

Over the past year, the Federal Reserve had repeatedly increased interest rates in a delicate balancing act designed to continue economic growth and reduce the inflation rate while simultaneously staving off, or even averting altogether, a recession. Interest rates impact borrowing costs for everyone from homebuyers to large businesses looking to raise capital. Lower rates mean more liquidity in the economic system, which can be a contributing factor to inflation.

And The Fed’s efforts appear to get inflation under control appear be working in concert with the ongoing recovery from supply shortages and other pandemic-related economic impacts.have fallen in the United States during the last six months of 2022, from a high of 9.06% in June to 6.454% in December.

Now that wage growth is slowing and inflation is ebbing, it’s believed the Federal Reserve may follow suit and begin reducing future interest rate hikes,It’s expected that the Federal Reserve will vote Wednesday to approve a 0.25% interest rate hike, according to The Hill.

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US wage growth slowed in the final quarter of 2022Pay and benefits for America's workers grew at a healthy but more gradual pace in the final three months of 2022, a third straight slowdown, which could help reassure the Federal Reserve that wage gains won't fuel higher inflation. Fed Chair Jerome Powell and economists consider the data released Tuesday, known as the employment cost index, to be the most comprehensive gauge of labor costs. Powell last year cited a sharp increase in the index as a key reason why the Fed accelerated its interest rate hikes. ‘Healthy’ but ‘gradual’. The key words twirling from the usual Yahoo liberal spin😀 What good has all of this raise the minimum and now all gone to INFLATION ? My gas now up almost a $1 in a mo WHY? One is Ga Gov gave back the .30 state tax he kept off. Other rising around WORLD WHY?
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