A Bloomberg survey of economists found that experts think the Federal Reserve (Fed) could raise interest rates to 5% in 2023, leading to a global recession.

With the arrival of November, all eyes in the United States are focused on the Federal Reserve (Fed). With September inflation remaining high, many experts have already predicted that central bank officials could raise interest rates once again, to hit 5% by March 2023, according to a survey by Bloomberg economists.

Most respondents expect the Fed to raise rates by 75 basis points for the fourth consecutive meeting, which would leave rates between 3.75% and 4%. The Federal Open Market Committee will announce its decision after a two-day meeting on Tuesday and Wednesday. A basis point is one hundredth of one percent.

“Inflationary pressures remain intense and the Fed will raise 75 basis points in November,” said James Knightley, chief international economist at ING Groep, in a response to the survey.

Then the US central bank will approve a 50 basis point hike in December, followed by 25 basis point hikes at the next two meetings in February and March, participants predicted.

“Currently, we are forecasting a more moderate increase of 50 basis points in December given a weakening economic and market environment,” Knightley concluded.

The survey results, based on the views of economists, indicate that rapid policy tightening is likely to trigger a recession in the United States and around the world.

Traders are pricing in a more than 80% chance of another 75 basis point hike at the end of the Fed’s two-day meeting next week, according to CME Group’s FedWatch tool, which tracks trade. Only 18% believe that the Fed will opt for a half point hike. The Fed has taken no action to discourage that expectation.

Officials may also take steps to boost rates even higher than expected in September as elevated inflation persists despite higher interest rates. The US central bank had projected a top rate of 4.6% next year, but that could rise, according to upcoming economic data.

The US central bank has raised rates the fastest in the country’s history to drive up borrowing costs and slow the economy. Officials approved a third consecutive 75 basis point rate hike in September, lifting the fed funds rate to a range of 3.0% to 3.25%, close to restrictive levels, and showed no signs of slowing down as they believe they combat the inflation.

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