• SP&500 closed down -157 points or -4.1%, the DOW down -1132 points or -3.7%, and the NASDAQ -471 or -4.2% for the week ending September 22nd.  Oil dropped -$5.97 or -7.0% to $79.43 per barrel on the news that aggressive interest rate hike may slow down the US economy to a recession, thus reducing the oil demand. 
  
• The aggressive interest rate hike of 0.75% by the Federal Reserve spooked many investors that the recession appears to be inevitable, thus fled from the stocks to safer cash or bond position.  The stocks tumbled close to 4% across the board!

As most predicted, the Feds raised key interest rates by 0.75% the 3rd time in a row and 5th this year to address stubborn inflation

The Fed Chair of the Federal Reserve, Mr. Jerome Powell, for the third time in a row raised the interest rate by 0.75% to address the rising interest rate.  In August inflation rose 8.3% annually which was lower than July 8.5% but this was considered to be an issue that the Federal Reserve Bank  is determined to address aggressively to tamper the economy and the rising inflation. 

Source-WashingtonPost

• As planned the Federal Reserve increased  Fed funds rate (overnite loan rate between the banks) and Discount rate (rate for Feds to Banks loan) by 0.75%. This is the consecutive large increase since 1994
• The Federal Reserve is on track to increase one more time 0.75-1.00% increases in 2022.  Expect the rates to be closer to 4.0% by the end of 2022.  The main street is already seeing the effect.  The 30-year fixed mortgage is now 7.5% and expected to rise.  The rise in interest rates have started to slow down the hot housing market as higher mortgage rates make the monthly payments higher for the home buyers.
  
• The Federal Reserve has concluded its long running asset-buying program to focus on curbing inflation. 
• Also read about the tapering – click Fed Tapering of Q.E.

What is a federal funds rate?

What is interest and APR?

Fed Funds Rate (overnight lending between banks from reserves)

Fed Funds rate range is at 3.00-3.25%

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Discount Rate (Feds charge member banks to borrow for reserves)

Discount rate is 3.25%