Central Banks
Fed Poised for Big Upgrade to Outlook Despite Swirling Risks
- Shift points to rates higher for longer, potential hikes
- Stronger first half would lead to major revisions for 2023
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Federal Reserve officials are likely to deliver their biggest upward revision to the US economic outlook since 2021 next month, as stress in the banking sector and a looming debt default belie the underlying strength of the economy.
That’s likely to reinforce their plan to keep rates at the peak level through the end of the year and into early 2024, despite a growing expectation among economists — including inside the central bank — that a recession will arrive over the coming months.