Fed Reserve Hikes Interest Rates

[Lawrence of Arabia]

by a quarter point, to three percent. the 8th hike since last june.

[Spiffor]

Does it mean the Fed is actually interested in slwoing down the collapse of the dollar?

[Lawrence of Arabia]

the dollar isnt collapsing. it has been appreciation these last few months, probably mostly because of the interest rate hikes. its a side effect, its not their main goal tho.

[Lancer]

Isn't the economy hitting the skids anyway? Why slow it down more?

[Japher]

I like to think the economy preceds the decision... or, the state of the economy today is because a week ago all the people who have their hands in money said "hey! The feds are going to raise interest 25 points next week, let do something about that now!

Thus, the effect of the raise that was done today has already been felt in the economy.

for the most part.

[KrazyHorse]

Originally posted by Lancer
Isn't the economy hitting the skids anyway? Why slow it down more?

The inflationary pressure is starting to become a serious threat to future stability.

Unfortunately, as you say, there is a trend toward slowing growth as well.

Most central banks take inflationary pressure as their primary indicator (as they should), trying to keep it around 2.5%. If they have any leeway then they start to take a look at other factors like the trade balance and the general state of the economy.

[KrazyHorse]

This ought to take some more pressure off Canada's export market, which was starting to feel the effects of the 25% appreciation versus US currency over the last couple of years...

[Lawrence of Arabia]

you gotta keep inflation low and thats the Feds primary job.

[Kidlicious]

Originally posted by Spiffor
Does it mean the Fed is actually interested in slwoing down the collapse of the dollar?

The Fed isn't worried about that, but they want to fight inflation first. So it may look like they are worried about the depreciation of the dollar.