<h2 id="quick-take">Quick Take</h2>
<ul>
<li>As we prepare for a 25bps rate hike that takes the Fed funds rate to 5.00-5.25%, this could be a third mistake from the Fed.</li>
</ul>
<h3 id="first-mistake">First Mistake</h3>
<ul>
<li>The Fed hiked rates way too late after inflation was still an issue; the Fed&#8217;s balance sheet continued to increase while inflation was surging.</li>
<li>Q2 2022: 8960B (peak)</li>
<li>Q4 2021: $8464B +$496B</li>
</ul>
<p>Inflation CPI YoY</p>
<ul>
<li>Q2 2022: 8.6%</li>
<li>Q4 2021: 5.5%</li>
</ul>
<figure id="attachment_322483" aria-describedby="caption-attachment-322483" style="width: 1315px" class="wp-caption aligncenter"><img class="wp-image-322483 size-full" src="https://cryptoslate.com/wp-content/uploads/2023/05/walcl.png" alt="Fed Balance Sheet: (Source: FRED)" width="1315" height="438" srcset="https://cryptoslate.com/wp-content/uploads/2023/05/walcl.png 1315w, https://cryptoslate.com/wp-content/uploads/2023/05/walcl-300x100.png 300w, https://cryptoslate.com/wp-content/uploads/2023/05/walcl-1024x341.png 1024w, https://cryptoslate.com/wp-content/uploads/2023/05/walcl-768x256.png 768w" sizes="(max-width: 1315px) 100vw, 1315px" /><figcaption id="caption-attachment-322483" class="wp-caption-text">Fed Balance Sheet: (Source: FRED)</figcaption></figure>
<h3 id="second-mistake">Second Mistake</h3>
<ul>
<li>Then the federal reserve increased the Fed funds rate at the quickest rate ever, ultimately crushing banks. We are now seeing the aftermath of these results.</li>
</ul>
<figure id="attachment_322485" aria-describedby="caption-attachment-322485" style="width: 473px" class="wp-caption aligncenter"><img class="wp-image-322485 " src="https://cryptoslate.com/wp-content/uploads/2023/05/ra.jpg" alt="Rate Hike: (Source: Federal Reserve)" width="473" height="473" srcset="https://cryptoslate.com/wp-content/uploads/2023/05/ra.jpg 1198w, https://cryptoslate.com/wp-content/uploads/2023/05/ra-300x300.jpg 300w, https://cryptoslate.com/wp-content/uploads/2023/05/ra-1024x1024.jpg 1024w, https://cryptoslate.com/wp-content/uploads/2023/05/ra-150x150.jpg 150w, https://cryptoslate.com/wp-content/uploads/2023/05/ra-768x768.jpg 768w" sizes="(max-width: 473px) 100vw, 473px" /><figcaption id="caption-attachment-322485" class="wp-caption-text">Rate Hike: (Source: Federal Reserve)</figcaption></figure>
<h3 id="third-mistake">Third Mistake</h3>
<ul>
<li>This is more of an opinion, but due to the above mistakes, it would be sensible to wait one more month to see the impact of said rate hikes. However, inflation is still over double the feds target so a rate hike can be deemed necessary.</li>
</ul>
<p>The post <a rel="nofollow" href="https://cryptoslate.com/insights/will-another-rate-hike-be-a-massive-mistake-by-the-fed/">Will another rate hike be a massive mistake by the Fed?</a> appeared first on <a rel="nofollow" href="https://cryptoslate.com">CryptoSlate</a>.</p>

Will another rate hike be a massive mistake by the Fed?

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