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Farm Progress America, November 9, 2023Farm Progress America, November 9, 2023

Mike Pearson takes a look at the decision to leave the interest rate alone at their meeting last week.

November 9, 2023

Mike Pearson takes a look at what was behind the decision to leave the federal fund rate unchanged. This means it costs a bank to borrow money from 5 1/4- 5 1/2 percent to borrow money overnight.

The United States Federal Reserve has been on an anti-inflation mission since January 2022. It has raised interest rates 11 times since then due to the economy being too robust.

And for many Americans, it wasn't a problem at first because they had cash on hand from the Covid payments. The goal was to slow down the economy to help with inflation rates.

However, there is a divide in what the economy is doing. The GDP remains strong and the economy grow by over 4 percent and unemployment has remained low.

But reports show consumer income and savings fell this summer with record high credit card bills and a growing concern over what will happen to many pocket books when the student loan bills come rolling in.

Some things are clear: Capital investments on the farm will cost more.

However, a recession is unclear but consumers will be paying more to borrow money.

Farm Progress America is a daily look at key issues in agriculture. It is produced and presented by Mike Pearson, farm broadcaster and host of This Week in Agribusiness.

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