TIRED OF PAYING MORE THAN $4.
A GALLON FOR GAS. SHE'D BE
HAPPY TO LEARN THE FEDERAL
RESERVE IS WORKING ON A FIX
FOR THE FIRST TIME IN MORE
THAN 3 YEARS. THE FED IS SET
TO RAISE INTEREST RATES. IT'S
A MOVE THAT'S MEANT TO HELP
CURB INFLATION. NBC NEWS NOW
ANCHOR ALLISON MORRIS COVERS
BUSINESS AND ECONOMY ISSUES
FOR US. SHE'S JOINING US NOW
WITH A CLOSER LOOK AT WHAT
MIGHT BE COMING FROM THE FED
1000.
>> AARON, CAN YOU BELIEVE IT'S
FINALLY HERE. THE FED MEETING
WE HAVE BEEN TALKING ABOUT FOR
SO DARNED LONG. SO WE JUST
WANTED TO MAKE SURE THE FED
MEETS TODAY BEFORE ITS RATE
HIKE TOMORROW THAT YOU
UNDERSTAND WITH THE FED IS AND
WHAT IT DOES. TAKE A LOOK.
>> NOW TO THOSE STAGGERING NEW
INFLATION NUMBERS INTEREST
RATES. THE FEDERAL RESERVE GAS
PRICES. FED IS PROBABLY GOING
TO RAISE INTEREST RATES WITH
THE GOAL OF TACKLING
INFLATION. THINK IT'S GOING TO
WORK. INFLATION IS AT A 40
YEAR HIGH ITS BEEF PRICES.
IT'S PRODUCE IT'S ALL GAS
PRICES ARE THE MOST EXPENSIVE
THEY'VE EVER BEEN. I DON'T
EVEN WANT TO KNOW, YOU KNOW, I
DON'T EVEN BECAUSE THE
PANDEMIC ISN'T OVER YET AND A
WAR IS RAGING IN UKRAINE BUT
TEAMS THAT NOTHING IS NOW OFF
LIMITS OF THE FEDERAL RESERVE
DEALING WITH A LOT RIGHT NOW,
BUT ITS MEETING TODAY AND
TOMORROW TO TRY AND GET SOME
OF THOSE THINGS UNDER CONTROL.
>> BUT FIRST LET'S TALK ABOUT
WHAT THE FEDERAL RESERVE IS
AND WHY DOESN'T OF ITS MEMBERS
ARE MEETING TODAY. THE FEDERAL
RESERVE OR THE FED IS THE
UNITED STATES CENTRAL BANK.
IT'S BEEN AROUND FOR OVER A
100 YEARS AND THINK OF IT LIKE
A LASAGNA WITH A BUNCH OF
LIARS. THERE'S THE BOARD OF
GOVERNORS. 12 REGIONAL FEDERAL
RESERVE BANKS AND THE FEDERAL
OPEN MARKET COMMITTEE WHICH
MEETS 8 TIMES A YEAR,
INCLUDING TODAY. THE IS
EXPECTED TO RAISE ITS FED
FUNDS RATE. WHAT WE TYPICALLY
CALL INTEREST RATES A QUARTER
POINT TOMORROW. ITS FIRST HIKE
IN 3 YEARS. NOW, THAT DOESN'T
SOUND GREAT. BUT IF YOU'RE
TIRED OF PAYING SO MUCH FOR
EVERYTHING FROM GAS TO
GROCERIES. IT CAN HELP. SO
WHAT HAPPENS WHEN INTEREST
RATES START GOING UP.
INFLATION STARTS COMING DOWN.
STOCK PRICES CAN COME DOWN TO
AND THE COST TO BORROW MONEY
STARTS TO GO UP. THINK
MORTGAGES CAR LOANS, STUDENT
LOANS, CREDIT CARDS. ALL MORE
EXPENSIVE.
>> LET'S LOOK AT MORTGAGES
SINCE SO MANY PEOPLE ARE
BUYING HOMES THESE DAYS. IF
YOU HAVE A FIXED RATE
MORTGAGE. NOTHING CHANGES. IF
YOU HAVE AN ADJUSTABLE RATE
MORTGAGE OR AN ARM EXPECT THAT
RATE TO GO UP AT ITS NEXT
RESET. AND IF YOU'RE LOOKING
TO GET A MORTGAGE. THOSE RATES
SHOULD TAKE HIGHER TOO. NOW
YOU MIGHT HAVE NOTICED OVER
THE LAST 2 YEARS WITH INTEREST
RATES NEAR 0 THAT YOUR SAVINGS
ACCOUNT BASICALLY GETS PENNIES
ON ALL YOUR HARD EARNED
DOLLARS. EXPECT THAT IMPROVED
THE TICKETS OF DEPOSIT OR CDS
WILL PAY BETTER INTEREST TOO.
SO HOW DOES FED RATE HIKE THEN
HELP WITH INFLATION. IT
ENCOURAGES PEOPLE TO SAVE
MONEY BY MAKING BORROWING MORE
EXPENSIVE. WE SPEND LESS
THINGS COST A LITTLE LESS
SUPPLY AND DEMAND. SO WHAT
HAPPENS TOMORROW WELL, THE FED
WILL WRAP UP ITS MEETING AND
ANNOUNCED ITS RATE DECISION AT
02:00PM. IN A STATEMENT THAT
EXPLAINS THE DECISION GIVES AN
OUTLOOK ON THE ECONOMY AT 2.30
FED CHAIR JEROME POWELL GIVE A
PRESS CONFERENCE INFLATION IS
TOO HIGH, BUT WE'RE GOING TO
GET BACK UNDER CONTROL J. AND
HE'S HAD THAT JOB SINCE
FEBRUARY OF 2018 APPOINTED BY
PRESIDENT TRUMP. CHAIR POWELL
READ THAT POLICY STATEMENT AND
TAKE SOME QUESTIONS FROM
REPORTERS AND OUR 2 YEARS OF 0
INTEREST RATES WILL BE OVER.
>> SO HE WALKED US THROUGH
THIS. WE UNDERSTAND INFLATION
IS AT THIS 40 YEAR HIGH. WE'VE
BEEN REPORTING THAT. WHAT IS
IT THAT MAKES THIS QUARTER
POINT INCREASE THE RIGHT
INCREMENT TO RAISE RATES
TOMORROW. YOU KNOW, SOME
PEOPLE MIGHT ARGUE THAT IT
ISN'T. BUT THERE'S ONE WORD
THAT THE FED IS TAKING INTO
ACCOUNT HERE AND THAT IS
UKRAINE. YOU'VE HEARD THE
EXPRESSION FOG OF WAR THERE IS
SO MUCH UNCERTAINTY.
>> ABOUT WHAT IS GOING ON IN
UKRAINE WITH OUR GLOBAL
ECONOMY THAT THE DOESN'T WANT
TO DO ANYTHING TOO DRAMATIC
TOMORROW THAT COULD SEND OUR
ECONOMY INTO A TAILSPIN AND
PERHAPS EVEN ENCOURAGE A
RECESSION. SO IT LOOKS LIKE
THEY'RE GOING TO GO WITH A
QUARTER POINT. IF YOU DON'T
BELIEVE ME, JUST LOOK THE CME
YOU SEE AND THE GROUP FORGIVE
ME. THEY HAVE SOMETHING CALLED
THE FED WATCH TOOL. IT
BASICALLY TELLS YOU WHAT THE
LIKELIHOOD IS OF THE FED
INCREASE AND THEY ARE SAYING
RIGHT NOW THAT THERE'S A 98%
CHANCE THAT THE FED WILL HIKE
RATES A QUARTER POINT
TOMORROW. THERE IT IS. SO
EVERYONE PRETTY MUCH THINKING
THAT'S WHAT'S GOING TO HAPPEN
TOMORROW. THE FED DOESN'T LIKE
SURPRISES. SO WE'RE NOT
EXPECTING ANY CHANGES OR FOR
THEM TO DEVIATE TOO MUCH FROM
THAT. ALL RIGHT. ALLISON
MORRIS, THANK YOU. THANKS,