The Dow Jones Industrial Average surged more than 500 points on Wednesday, closing above 37,000 for the first time, according to reports.
The historically high close for stock index came on the same day that the Federal Reserve announced plans to maintain current interest rates. A Federal Open Market Committee statement notes that “the Committee decided to maintain the target range for the federal funds rate at 5-1/4 to 5-1/2 percent.”
During a press conference, Federal Reserve board of governors chair Jerome Powell said “tight policy is putting downward pressure on economic activity and inflation, and the full effects of our tightening likely have not yet been felt.”
He noted that “we believe that our policy rate is likely at or near its peak for this tightening cycle,” but also said that officials are “prepared to tighten policy further, if appropriate.”
Data released on Wednesday listed 4.6% as the median projection among Fed officials for the rate by the end of 2024.
While the rate of inflation has been on the decline, Americans’ have still been experiencing the persistent erosion of the purchasing power of their hard-earned dollars over time.
“The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1 percent in November on a seasonally adjusted basis, after being unchanged in October,” according to the U.S. Bureau of Labor Statistics. “Over the last 12 months, the all items index increased 3.1 percent before seasonal adjustment.”
President Joe Biden, who aims to secure another four-year term during the 2024 presidential election, declared in a December 12 statement, “Today’s report demonstrates continued progress bringing inflation down and lowering costs for American families. Inflation is now at 3.1 percent — down by nearly two thirds from its peak.”
“While Congressional Republicans fight for the wealthy and big corporations, leaving hardworking families to pay the price, I’ll keep fighting to bring down costs and grow our economy with a strong middle class,” Biden claimed in the statement.
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