📰 The Fed is tightening its belt

The Fed always faces a tradeoff between promoting good business conditions and fighting inflation:

1. If it raises interest rates, it can fight inflation, but the economy will weaken.

2. If it lowers interest rates, inflation may rise, but the economy will thrive.

This tradeoff is reflected in the “dual mandate” given to the Fed by Congress:

“Price Stability” means “low and steady inflation”

“Maximum Employment” means “an economy that is thriving”

Recently, inflation has begun to rise, so the Fed is taking dramatic action.

The Federal Open Market Committee (FOMC) just released the minutes from their March 15th-16th meeting:

https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm