What is the Fed thinking going into year-end?
The Fed will conclude its final meeting of the year on December 14 and they are expected to
raise the federal funds rate by 50 bps at that meeting.
This will be a step down from their unprecedented series of four 75 bps hikes in the past four meetings. A slowdown in the pace of rate increases is needed because the Fed needs more time to see how past increases have impacted the economy. It takes time for the full effects of those rate increases to ripple through the economy.