The Fed announced its largest interest rate hike in nearly 30 years.
What do you mean?
Yesterday, the Fed said it's raising rates by three-quarters of a percentage point — the highest hike in almost 30 years. The Fed had already raised rates twice this year — most recently by half a percentage point last month. But yesterday’s bump was higher than the half-point the Fed teased in statements leading up to the meeting. Fed Chair Jerome Powell said, “strong action was warranted.”
And what will this strong action do?
Deter people from throwing around dollar bills and slow inflation down from over 8% closer to the Fed’s goal of around 2%. The central bank's responsibilities include two things: keeping prices at bay and unemployment low. But at this point, it may be too late. Prices on everything from food to clothing could remain high by the end of the year. The job market could take a hit (see: hiring freezes). And so could the housing market. All of this is making economists say the word no one likes to hear: recession.
Is that where we’re headed?
Well, Powell says the Fed’s “not trying to induce” one. Comforting. But you can expect a 3.4% benchmark rate by the end of the year. In the meantime, there are steps you can take: do a budget check. Focus on paying down your credit cards and private student loans ASAP before rate hikes go further. You can also look for a high-yield savings account and step up your investing game.
Inflation has the Fed slamming on the economic brakes. Once the dust settles, we’ll see where that leaves us with prices, unemployment rates, and economic growth.
PS: Here's what all this means for your money and what you can do about it.
Why ‘forever’ isn’t always romantic...
Ask the EPA. Yesterday, the agency released drinking water advisories on “forever chemicals” (more formally known as PFAS). Found in thousands of products — like some makeup, cookware, food packaging, and clothing — they don’t break down naturally in the environment. And have leaked into US soil, drinking water, and air. The agency says exposure may lead to infertility, developmental delays, and a higher risk of some cancers. Now, the EPA says the chemicals are more dangerous than previously thought, even at hard-to-detect levels. Completely eliminating exposure is a tough feat, but you can do things like avoid eating contaminated fish and ask your local health department if your water is contaminated.
PS: We've got more on how "forever chemicals" can impact your health here.
What President Biden is up to during Pride Month…
Signing this executive order. Yesterday, Biden signed an order protecting LGBTQ+ youth from conversion therapy. Though the UN says it can amount to torture, the practice is only banned in about 20 US states. Under the new order, HHS will work with states to bolster access to gender-affirming care and family counseling. The department will also consider issuing new guidance clarifying conversion therapy can not be federally funded. And Biden’s EO would direct other agencies to review policies in schools to address sexual discrimination, including sexual orientation and gender identity. Biden said the order is in response to the more than 300 anti-LGBTQ+ laws that have been intro’d in state legislatures this year alone — with many specifically targeting transgender children and their parents.
...Oh and the news comes as a transgender health association reportedly lowered its recommended age for gender transition treatments to 14. Critics worry about the irreversible nature of treatments like sex surgeries. The org acknowledged concerns but said withholding the treatments can be even more damaging.
PS: Here's a history of queer stigma and how it affects the LGBTQ+ community's mental health today.
What’s been a long time coming…
Vaccines for kids. Yesterday, FDA advisors voted unanimously to recommend authorizing COVID-19 vaccines for children as young as six months to under 5 years old. The green light came after trial reviews (conducted while Omicron was prevalent) found that both the Moderna and Pfizer vaccines are generally safe and effective with youngsters. Next up, the FDA — which typically follows the panel’s recommendations — could authorize the vaccine within days. And if the CDC follows suit, parents could begin scheduling their children's shots at pharmacies as soon as next week.
PS: We spoke to two experts about the pros and cons of each vaccine and what to know if you're feeling hesitant about getting your kids vaccinated.
What’s closing its window…
Who’s got us saying ‘Ken you even’...
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