The US central bank’s monetary policy committee began a two-day meeting on Tuesday, at the end of which it is expected to announce another sharp hike in the key interest rate to combat high inflation in the US. As reported by AFP, the negotiations should end at noon on Wednesday.

At the meeting, the Fed is expected to update its forecasts for US GDP growth, inflation and the unemployment rate.

And for the fifth time since March, he will raise the key interest rate, trying to slow down inflation. This rate, which currently ranges between 2.25-2.50%, sets the tone for commercial banks when setting interest rates for loans to individuals and legal entities.

A third increase of three quarters of a percentage point (75 basis points) is expected. But the rise could be even bigger: nearly one in five market participants expect a rise of one percentage point, according to the CME Group futures rating.

The rate hike is aimed at slowing economic activity to ease price pressures, as inflation eased in August amid falling gasoline prices but remained well above expectations at 8.3% year-on-year as prices rose across the board.

This deliberate economic slowdown, which will undoubtedly be accompanied by rising unemployment, is even more delicate as recession threatens the US economy and, more broadly, the world economy.

However, the excellent state of the labor market gives the Federal Reserve room to be aggressive and hope to achieve the “soft landing” it seeks.

The US unemployment rate is at 3.7%, one of the lowest rates in 50 years, and there are not enough workers to fill all the vacancies.