1. What is the recent trend in American inflation?
The Consumer Price Index (CPI)-based inflation rate in the US for August rose at the fastest pace in over a year, reaching 3.7%, up from 3.2% in July.
2. How is the Federal Reserve responding to this inflation?
The Federal Reserve has increased its benchmark policy rate range to 5.25-5.5%, the highest in over two decades, as part of its efforts to combat inflation.
Markets expect the Fed to keep the policy rate unchanged at the upcoming September meeting, but analysts anticipate one more rate increase in the current cycle.
Regardless of the timing of the next rate increase, interest rates are likely to remain elevated as the Fed aims to bring inflation down to its 2% target.
3. What are the global implications of higher US interest rates?
Sustained higher US interest rates may affect both the US and global markets.
It can impact capital flows and currency markets, potentially leading to changes in the value of various currencies.
4. How has the Chinese yuan been affected?
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