Oct 14, 2021
Federal Reserve Begins Taking Steps To Fight Growing Inflation
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The Federal Reserve said in September that it would begin taking steps to combat growing inflation in the U.S. economy, according to notes from a Sept. 21 and Sept. 22 Open Market Committee meeting first obtained by The Wall Street Journal.
The Federal Reserve will be scaling back its $120 billion monthly purchases of U.S. Treasury and mortgage securities due to the growing surge in inflation and strong consumer spending leading to heightened demand, according to minutes from a September meeting released Wednesday by the WSJ. The reduction in spending, commonly referred to as tapering, will begin in mid-November, and experts believe it could end by June, according to the meeting notes.
The Fed will slow down its spending, cutting purchases by $15 billion a month that are split between mortgage securities and bonds, the WSJ reported.
WASHINGTON, DC – OCTOBER 06: Federal Reserve Chairman Jerome Powell walks between meetings with Senators on Capitol Hill on October 06, 2021 in Washington, DC. (Photo by Kevin Dietsch/Getty Images)
Bond purchases have been a cornerstone of the Fed’s stimulus policy plan to keep interest rates down in an effort to maintain economic growth during the COVID-19 pandemic, The Wall Street Journal reported. (RELATED: Americans Getting Poorer As Prices Go Up 5.4% Year Over Year And Wages Can’t Keep Up)
The Fed’s decision reflects the increasing desire to tackle growing inflation in the economy, which has lasted longer than experts expected, the WSJ reported.
Fed officials in favor of tapering believe raising rates and reducing asset purchases will bring inflation back to the central bank’s 2% target, according to the WSJ. Conversely, other Fed officials believe inflation will naturally come down to the 2% target, and the rapid spike in interest rates could jeopardize the central bank’s desire to keep inflation below 2%.
Federal Reserve Chairman Jerome Powell had said earlier in 2021 that the spike in prices is “transitory,” and would only last 6-9 months, the Daily Caller News Foundation reported. Other Fed officials pushed back on the idea, citing the growing inflation numbers.
“There’s also some evidence that they may not be so transitory, and that’s a risk I’m worried about,” Philadelphia Fed President Patrick Harker told CNBC.
The Consumer Price Index (CPI) increased .04% in September, bringing year-over-year inflation to 5.4%, the Bureau of Labor Statistics announced Wednesday. September’s figure is the highest year-over-year inflation jump since January 1991.
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New Jersey reports taking in more than $1B in sports betting in September
Nine casinos and three racetracks in Atlantic City took in $1.01 billion worth of wagers on sports as football returned in September, according to figures from New Jersey’s Division of Gaming Enforcement released on Monday.
The previous national record for a single state was $966 million wagered on sports betting in December 2020, according to the AP.
More than $82 million of September's wagers were kept by casinos and tracks as revenue due to winning bets and other expenses being paid.
East Rutherford’s Meadowlands Racetrack alone accounted for half of the $82 million, the AP reported.
New Jersey in 2018 won a Supreme Court case that paved the way for all 50 states to offer legal sports betting.
New Jersey’s gambling industry made $453.5 million last month, with revenue up 40 percent from 2020, the AP noted.
Tags Atlantic City New Jersey Sports betting Gambling Wagering