Phil Moore and Clint Karnes, Cape Girardeau-based bankers, are in agreement about Wednesday’s action by the Federal Reserve to quell inflation by raising the federal funds rate by 0.5%, the highest increase in 22 years.
Moore, market president for Banterra Bank in Cape Girardeau and East Prairie, Missouri, said he is hopeful the hike will have “the desired effect,” adding, “I think with a market faced with soaring prices and a record number of openings, the Fed had to take action. It was the right move and had to be done.”
Karnes, Wood & Huston Bank’s market president for Cape Girardeau and Jackson, concurred.
“(A hike) is about the only tool the Fed has to fight inflation inflation brought about by supply-chain issues and the Russian conflict. This was not unexpected and we expect more of these over the next few months,” Karnes said.
According to the Wall Street Journal, higher rates make it more expensive to buy a home or a car or carry a credit card balance.
It is the second rate hike this year, after a smaller increase in March.
“Inflation is much too high and we understand the hardship it is causing,” Fed chairman Jerome Powell said in a news conference. “We’re moving expeditiously to bring it back down.”
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