Since there are no plans for a fourth stimulus check, there has been no announcement that it will end. There have already been three stimulus checks, but they have been independent of the Federal Reserve. What the bank has done is support mortgages and businesses by pumping hundreds of billions of dollars into the economy every month since the pandemic started.
However, the Fed has said it is starting to step down payments directly to the US economy, to reduce funding by $ 15 billion a month. On Wednesday, they would start cutting down on this stimulus by 15 billion. USD per month, but left interest rates unchanged.
Rise in interest rates put on hold by world banks
An increase in interest rates to counter inflation has long been expected to be implemented, but Powell says there are other factors at play that higher interest rates will not address, such as the chaos in global supply chains. It predicts that this problem will persist until the second half of 2022.
“We do not think it is time yet to raise interest rates. There is still land to cover to reach maximum employment,” Fed Chief Jerome Powell saidand added that he felt that goal might be reached by the end of next year. In the meantime, expect high commodity prices.
This attitude has been repeated by other central banks as the Bank of England (BoE) and the European Central Bank (ECB). The BoE said on Thursday that it would keep its interest rates at the same level, while the ECB said it would not raise interest rates until April 2022. This follows previous pandemic planning to keep borrowing costs low to encourage people to spend. Countries in Europe are starting to see cases of covid-19 risewhile Britain has not had cases out of tens of thousands for months.
The Fed also counteracts that a rate hike would now prevent people from returning to the U.S. workforce, which looks higher than normal unemployment while keeping a record number of vacancies. Unemployment is at 4.8 per cent while there are more than 10 million available jobs.