Interest rates

How high will interest rates rise in 2022?

The world is grappling with the rising cost of living, but how long exactly will the price hikes last?

Globally, the economy is still trying to cope with the continued fallout from the Russian invasion of Ukraine.

And on top of that, the ongoing covid lockdowns in China are impacting global trade. This sent the price of basic necessities skyrocketing, with the prices of groceries and gasoline hurting the back pocket.

The main American banking authority has just given the public a glimpse of its state of mind, by publishing the minutes of the last political meeting.

The Federal Reserve has indicated that interest rate hikes may be higher than expected in an effort to curb inflation.

Officials have confirmed that they are ready for several rate hikes of 50 basis points.

“Markets reacted very positively today…The Fed is preparing not to let the markets fall much further”

marenzi octave

But how high will interest rates go exactly?

“I think it’s going to be much higher than 3.5 or 4%”

Octavio Marenzi

The new data shows that there is some hope for slowing inflation, but also clearly shows that there is skepticism about financial stability.

If we look at housing, new home sales are down around 16%, with many fearing that buying a home is simply out of reach for people right now.

This is of course in addition to the exorbitant prices of gasoline, groceries and minimum wage.

“For many Americans, housing is now out of reach… Homes are very expensive… This is having an effect on landlords and renters”

marenzi octave