4.6% Unemployment Predicted by the End of 2023

Associated Press (12/14/22) Rugaber, Christopher

The U.S. Federal Reserve boosted its benchmark rate a half-point to a range of 4.25% to 4.5%, its highest level in 15 years. In a statement and a news conference by Chair Jerome Powell, the Fed said that it thinks sharply higher rates are still needed to fully tame the worst inflation bout to strike the economy in four decades. The policymakers forecast that their key short-term rate will reach a range of 5% to 5.25% by the end of 2023.

In its updated forecasts, the Fed’s policymakers predicted slower growth and higher unemployment for next year. The unemployment rate is envisioned to jump to 4.6% by the end of 2023, from 3.7% today. That would mark a significant increase in joblessness that typically would reflect a recession. The officials also projected that the economy will expand just 0.5% next year, less than half the forecast the Fed had made in September.

This article originally appeared on apnews.com. Use this link to see the full article and report: Fed raises key rate by half-point and signals more to come