The stock market continues its crumble.
The Dow has fallen below 30,000 and so far has dropped over 700 points.
Stocks fell after rebounding a day earlier: The Dow Jones Industrial Average lost 2.1%, around 700 points, while the S&P 500 dropped 2.8% and the tech-heavy Nasdaq shed Composite 3.3%.
The Dow fell below the 30,000 mark, hitting its lowest level so far in 2022 amid the ongoing stock market selloff.
The Federal Reserve just raised interest rates 0.75%.
This is the highest increase since 1994.
— Newsmax (@newsmax) June 15, 2022
The Federal Reserve on Wednesday intensified its drive to tame high inflation by raising its key interest rate by three-quarters of a point — its largest hike in nearly three decades — and signaling more large rate increases to come that would raise the risk of another recession.
The move the Fed announced after its latest policy meeting will increase its benchmark short-term rate, which affects many consumer and business loans, to a range of 1.5% to 1.75%.
The central bank is ramping up its drive to tighten credit and slow growth with inflation having reached a four-decade high of 8.6%, spreading to more areas of the economy and showing no sign of slowing. Americans are also starting to expect high inflation to last longer than they had before. This sentiment could embed an inflationary psychology in the economy that would make it harder to bring inflation back to the Fed’s 2% target.
They were only expected to do a 50 point increase until a few days ago.
Until just a few days ago, economists widely expected the central bank to proceed with a 50-basis point rate hike – double the typical size – at its June meeting. Policymakers had approved a 50-basis point hike in May and laid out a roadmap for similarly sized increases at their upcoming meetings, assuming that data evolved as expected.
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