Fed's Interest Rate Forecast and Diverging Monetary Actions.

The Federal Reserve has paused its rate hiking campaign but signaled that its battle against inflation isn't over. The central bank forecast another half percentage point in rate increases this year, which is a quarter point more than economists anticipated and a half point more than the Fed itself projected in March. The Fed believes it needs to continue to push up rates since inflation has responded only modestly to its previous hikes. Although the Fed hasn't predicted any rate cuts in 2023, markets have pushed out their projection for the first rate cut to January.