The Fed Hikes Rates


For the first time since back in 2018, the Federal Reserve has increased the key benchmark interest rate by 25 basis points. It is worth noting that in 2018, the S&P 500 had a year-end return of -6.24%, which was the worst return since the 2008 financial crisis. Looking at this, it appears that Wall Street has a disdain for increasing interest rates. But plenty of investors saw the 25 basis point hike rather than a 50+ point hike as a welcome sight. In addition, The Fed has plans on raising rates at each of their next FOMC meetings. The committee also noted geopolitical concerns in Ukraine. Overall, Wall Street seemed content with the Fed’s plan as all three indexes ended in the green with the Nasdaq almost up 4%. It will now be important for the Federal Reserve to balance continuing growth and stopping high levels of inflation.