WASHINGTON (dpa-AFX) – The US Federal Reserve will probably raise its key interest rates much more significantly than previously planned. The key interest rate is likely to be around 3.4 percent by the end of 2022, according to new central bank projections on Wednesday. Previously, the estimate had been 1.9 percent. A key interest rate of 3.8 percent is expected at the end of 2023, after an interest rate of 2.8 percent had previously been forecast. At the end of 2024, the key interest rate is expected to be around 3.4 percent. This expectation is also significantly higher than the previous one.
The assessments for economic growth are less favourable. Growth of 1.7 percent is expected in 2022, after 2.8 percent so far. Expectations for 2023 and 2024 have also been reduced. Inflation is expected to be 5.2 percent this year before falling to 2.7 percent and 2.3 percent respectively in the next two years. It is only expected in the longer term that the Fed target of two percent will be reached.
The central bank’s projections result from the assessments of the individual central bank members. It is the median value./bgf/jsl/he