Financial TimesFinancial Times

Soaring US inflation puts pressure on Fed to abandon guidance again

By Colby Smith

14 Jul 2022 · 4 min read

Editor's Note

With the US inflation hitting a four-decade high of 9.1% the Federal Reserve is pondering whether to raise interest rates by 0.75% or 1%.

Some traders are betting central bank will opt for 1 percentage point increase despite telegraphing a smaller riseThe Federal Reserve is under pressure to abandon its monetary policy guidance for the second month in a row in the face of soaring inflation, as market participants increasingly bet the US central bank will raise interest rates by a full percentage point at the end of the month.

Consumer prices across most goods and services rose again in June at a speed that pushed the annual increase to 9.1 per cent, the biggest jump since November 1981.

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