The article might as well be telling the future, they will continue to raise the prime rate until inflation eases, of course as they raise the prime rate unemployment will go up as well. Inflation is only caused by two things, government spending and the amount of money printed. Considering they are unwilling to stop spending and have to keep selling bonds to finance said spending the rate increases are a road to no where, if you don’t fix the base problem it will just slow inflation but at a greater cost. The prime rate in 1980 was almost 22% and they didn’t even have a national debt(it was minuscule) or a money printing problem, the prime rate today is 4.75, I’m guessing it will be over 6 by years end with more increases in 2023. I’m not sure most people realize how screwed we really are if spending doesn’t stop. Every new bond we write at the higher rate will take more of the budget to pay the interest, eventually we will refinance the current bonds with rates double, triple, quadruple the interest costs, hence causing more spending just to keep bloated government programs at current funding levels. If the underlying problem isn’t fixed it’s literally a economic death spiral, the more you raise rates the more interest bonds cost to finance, the more you have to spend.
