Forget President Joe Biden's "Build Back Better," Federal Reserve Chairman Jerome Powell might as well switch out the BBB acronym to "Beat Back Bidenflation" as he and the Fed struggle to bring inflation down by making it too expensive for American businesses and citizens alike to borrow money and continue spending.
On Wednesday afternoon, the Fed announced its latest move to try and tamp down inflation that's grown out of control and gone unacknowledged, then unaddressed, by the Biden administration: An interest rate increase of 75 basis points.
FED DECISION: The Federal Reserve votes to hike interest rates by 75 basis points. https://t.co/TGIAEh7nob pic.twitter.com/rz6yallEOQ
— CNBC (@CNBC) November 2, 2022
According to the Fed's statement announcing its latest rate hike — bringing the target to 3.75-4.00 percent — that their goal is "maximum employment" and inflation at a much lower rate of just "2 percent."
Wednesday's announcement of yet another rate hike is the sixth consecutive increase of 2022 and fourth hike of 75 basis points in a row and brought the target rate to a level not seen in roughly 15 years.
⚠️BREAKING:
— Investing.com (@Investingcom) November 2, 2022
*FED HIKES INTEREST RATE BY 75BPS TO 4.00%, HIGHEST SINCE 2008
🇺🇸 🇺🇸 pic.twitter.com/JaovMGHAEi
But the Fed also said that it didn't expect this to be its last rate hike necessary to achieve its goals regarding employment and inflation, though future increases may be less than the 75 basis point jumps that have been seen in the last several announcements.
"The Committee anticipates that ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time," the Federal Open Market Committee (FOMC) said in its statement announcing the decision.
"In determining the pace of future increases in the target range, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments," the statement continued, suggesting that the Fed anticipates the effects of its previous repeated rate hikes may soon be felt.
Fed Chair Powell: "Today, the #FOMC raised our policy interest rate by 75 basis points and we continue to anticipate that ongoing increases will be appropriate...Restoring price stability will likely require maintaining a restrictive stance of policy for some time." pic.twitter.com/PQ0tEXsg33
— CSPAN (@cspan) November 2, 2022
Those impacts, while perhaps welcome in terms of easing inflation, will not bring less hardship for Americans in the near-term as the Fed battles inflation caused by Biden and his party's tax-and-spend policies. As Federal Reserve Chairman Powell himself explained at a previous meeting, "restoring price stability will take some time and requires using our tools forcefully to bring demand and supply into better balance," actions that will "bring some pain to households and businesses," he warned.
That "pain" to Americans — as they're already been struggling under lasting inflation for months — is the consequence that now must follow the Biden administration's refusal to address inflation. Rather than taking corrective action, Biden and congressional Democrats kept their collective foot on the spending gas pedal and made things even worse. The falsely-named "Inflation Reduction Act" didn't do anything either, and the new "pain" forewarned by Chairman Powell is going to make the consequences of Biden's policies even more apparent to Americans in the weeks and months ahead.
"The Fed's decision to raise rates is a black eye on the Biden Administration," said Alfredo Ortiz, president and CEO of Job Creators Network. "The Administration's record spending spree is fueling the inflation that the Fed is desperately seeking to contain. Small Business owners and aspiring homeowners will now experience higher borrowing costs as the Fed acts to mitigate the Administration's irresponsible far-left policies," Ortiz explained. "The highest inflation rate in four decades cannot be blamed on ‘Putin’s Price Hike,’ it is a direct result of the Democrats' policies, including higher taxes and stifled domestic energy production. With less than a week until Election Day, the Fed's decision is a fresh reminder Biden’s policies continue to fuel inflation and a real recovery can't begin until a new Congress can rein in the worst excesses of the Administration," he remarked.
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