However, they relented and agreed to vote for another rate hike "because of elevated inflation, the strength of the recent economic data, and their commitment to bring inflation down to the Committee's 2 percent longer-run goal." Several policymakers questioned whether to hold rates steady as they watched to see how the crisis unfolded. That brought the fed funds rate to a target range of 4.75%-5%, its highest level since late 2007. FOMC officials ultimately voted to increase the benchmark borrowing rate by 0.25 percentage point, the ninth increase over the past year. That crisis had caused some speculation that the Fed might hold the line on rates, but officials stressed that more needed to be done to tame inflation.
With the Atlanta Fed tracking a first-quarter gain around 2.2%, that would indicate a pullback later in the year. Projections following the meeting indicated that Fed officials expect gross domestic product growth of just 0.4% for all of 2023. "Given their assessment of the potential economic effects of the recent banking-sector developments, the staff's projection at the time of the March meeting included a mild recession starting later this year, with a recovery over the subsequent two years," the meeting summary said. Though Vice Chair for Supervision Michael Barr said the banking sector "is sound and resilient," staff economists said the economy will take a hit. Minutes from the March meeting of the Federal Open Market Committee included a presentation from staff members on potential repercussions from the failure of Silicon Valley Bank and other tumult in the financial sector that began in early March. banking crisis is likely to tilt the economy into recession later this year, according to Federal Reserve documents released Wednesday. Personal Loans for 670 Credit Score or Lower
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