The Fed will raise interest rates more aggressively in future meetings

Federal Reserve Chairman Jerome Powell said at a news conference after the Fed meeting that officials will raise interest rates more aggressively at future meetings if necessary to control inflation. Powell emphasized that the US economy is strong and should thrive even in an environment where borrowing costs are rising and stimulus is removed.

It is clear that the time has come to raise interest rates and start shrinking the balance sheet, however, the economic slowdown may have already begun. The benchmark 10-year Treasury yield briefly rose to the highest level since May 2019, while the two-year Treasury yield, which better reflects market views on the Fed's policy direction, briefly surpassed the 2.0% level for the first time since May 2019.