FT News Briefing Fed hikes rates, but next steps are uncertain
Jul 28, 2022
The Federal Reserve raises interest rates by 0.75% for the second consecutive month, heightening concerns about economic slowdown. Meanwhile, turmoil surrounding Elon Musk's Twitter acquisition is negatively impacting employee morale and advertising revenue. Over in Europe, gas prices are soaring due to Russia cutting supplies, increasing recession fears. In a lighter twist, Australian farmers face an avocado surplus, leading them to seek new markets in Asia and the UK. Avocados are shifting from luxury to everyday staples!
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Fed's Rate Hike Strategy
- The Federal Reserve raised its benchmark interest rate by 0.75% for a second consecutive month to combat inflation.
- Despite signs of an economic slowdown, the Fed aims to ensure inflation decreases before adjusting its policy.
Fed's Shift in Forward Guidance
- Chair Powell's guidance on future rate hikes was less specific than in previous meetings.
- This departure from forward guidance may signal a shift in the Fed's communication strategy.
Impact of Musk Saga on Twitter Employees
- Twitter employees are experiencing frustration and uncertainty due to Elon Musk's attempted withdrawal from the acquisition deal.
- Internal communication has decreased, and some employees have resorted to private messaging groups.