The Federal Reserve is expected to take a big step to try to lower inflation

The Federal Reserve is expected to take a big step to try to lower inflation

Transcript¹

The Fed is likely to raise interest rates by a half-percentage point Wednesday, in an effort to crack down on inflation. It's the first rate hike of that size in more than two decades.

A MART?NEZ, HOST:

It's about to get more expensive to borrow money. Leaders of the Federal Reserve are meeting today, and they're expected to approve the biggest jump in interest rates in more than two decades. It's all part of an escalating² push to address stubbornly high inflation. But the Fed's action is not without risk. NPR's Scott Horsley is here. Scott, the Fed has kept interest rates super low for most of the last two years. What's behind this turnaround?

SCOTT HORSLEY, BYLINE³: Inflation. According to the Fed's preferred yardstick⁴ for inflation, prices in March were up 6.6% from a year ago. That's more than triple the central bank's target rate for inflation, and it's the sharpest increase in prices since 1982. Even if you strip out volatile⁵ food and energy costs, prices were up 5.2%. There's just this real mismatch right now between consumers' strong demand for goods and services and what businesses are able to deliver, especially when those businesses are still scrambling⁶ to find enough workers and parts. So you've got inflation heating up. The Fed wants to cool things off. And the way it does that is by making it more costly⁷ to borrow money.

MART?NEZ: All right, so what's this going to mean for consumers?

HORSLEY: Well, anyone who's been shopping for a home loan has already seen the big jump in mortgage rates. Other interest rates are going to be going up as well - so car loans, credit card balances. Any sort of borrowing is going to get more expensive. For most of the pandemic, the Fed kept interest rates close to zero as it tried to prop⁸ up the economy, but starting this spring, it made this U-turn. It raised rates by a quarter percentage point back in March, and today it's expected to raise rates by another half percentage point. If so, that'd be the first half-point rate hike since Bill Clinton was in the White House. And forecasters think rates are going to keep going up in the months to come.

MART?NEZ: Scott, look into your crystal ball, if you can. Any clue how this is going to affect the economy?

HORSLEY: There's a lively debate about that. Ideally, these higher interest rates would gently tap the brakes on demand, bring it back into balance with supply, and inflation would gradually coast down to something closer to 2%, the Fed's target. That's what economists⁹ call a soft landing, and it's what Fed Chairman Jerome Powell and his colleagues hope to achieve.

(SOUNDBITE OF ARCHIVED RECORDING)

JEROME POWELL: That's our goal. I don't think you'll hear anyone at the Fed say that that's going to be straightforward¹⁰ or easy. It's going to be very challenging.

HORSLEY: Some analysts¹¹ think the Fed has waited too long to react and that now it's going to be very hard to get control over inflation, especially when you've got the war in Ukraine and ongoing¹² lockdowns in Shanghai putting more upward pressure on prices. The concern is that the Fed might have to raise interest rates so high that it won't just slow the economy but push it into reverse. And the fear that that could trigger a recession is one of the factors that's been prompting all the volatility¹³ we've seen in the stock market in recent days.

MART?NEZ: Scott, you mentioned earlier how employers are still struggling to find enough workers. How does the job market affect the Fed's thinking?

HORSLEY: Well, right now there is a record number of job openings. There are almost twice as many openings as there are unemployed¹⁴ people to fill those jobs. That means employers are having to compete for workers. They're having to pay more and offer higher benefits. Now, that's good for workers, but it is somewhat worrisome for the Fed. Here's Powell speaking at an IMF conference a couple weeks ago.

(SOUNDBITE OF ARCHIVED RECORDING)

POWELL: The labor¹⁵ market is extraordinarily¹⁶ tight, extremely tight, historically so, to the point where really there's an imbalance between supply and demand for workers.

HORSLEY: Private sector¹⁷ wages this spring were up about 5% from a year ago. Powell and his colleagues are worried that if wages continue to climb at a really rapid pace, that will just fuel additional inflation, the kind of wage-price spiral we saw back in the 1970s. And of course, workers are already seeing their real buying power eroded¹⁸ by the high pace of inflation.

MART?NEZ: NPR's Scott Horsley. Scott, thanks.

HORSLEY: You're welcome.

1 transcript   

n.抄本，誊本，副本，肄业证书

参考例句：

• A transcript of the tapes was presented as evidence in court.一份录音带的文字本作为证据被呈交法庭。
• They wouldn't let me have a transcript of the interview.他们拒绝给我一份采访的文字整理稿。

2 escalating   

v.（使）逐步升级( escalate的现在分词 )；（使）逐步扩大；（使）更高；（使）更大

参考例句：

• The cost of living is escalating. 生活费用在迅速上涨。 来自《简明英汉词典》
• The cost of living is escalating in the country. 这个国家的生活费用在上涨。 来自辞典例句

3 byline   

n.署名；v.署名

参考例句：

• His byline was absent as well.他的署名也不见了。
• We wish to thank the author of this article which carries no byline.我们要感谢这篇文章的那位没有署名的作者。

4 yardstick   

n.计算标准，尺度；评价标准

参考例句：

• This is a yardstick for measuring whether a person is really progressive.这是衡量一个人是否真正进步的标准。
• She was a yardstick against which I could measure my achievements.她是一个我可以用来衡量我的成就的准绳。

5 volatile   

adj.反复无常的，挥发性的，稍纵即逝的，脾气火爆的；n.挥发性物质

参考例句：

• With the markets being so volatile,investments are at great risk.由于市场那么变化不定，投资冒着很大的风险。
• His character was weak and volatile.他这个人意志薄弱，喜怒无常。

6 scrambling   

v.快速爬行( scramble的现在分词 )；攀登；争夺；（军事飞机）紧急起飞

参考例句：

• Scrambling up her hair, she darted out of the house. 她匆忙扎起头发，冲出房去。 来自《现代英汉综合大词典》
• She is scrambling eggs. 她正在炒蛋。 来自《简明英汉词典》

7 costly   

adj.昂贵的，价值高的，豪华的

参考例句：

• It must be very costly to keep up a house like this.维修这么一幢房子一定很昂贵。
• This dictionary is very useful,only it is a bit costly.这本词典很有用，左不过贵了些。

8 prop   

vt.支撑；n.支柱，支撑物；支持者，靠山

参考例句：

• A worker put a prop against the wall of the tunnel to keep it from falling.一名工人用东西支撑住隧道壁好使它不会倒塌。
• The government does not intend to prop up declining industries.政府无意扶持不景气的企业。

9 economists   

n.经济学家，经济专家( economist的名词复数 )

参考例句：

• The sudden rise in share prices has confounded economists. 股价的突然上涨使经济学家大惑不解。
• Foreign bankers and economists cautiously welcomed the minister's initiative. 外国银行家和经济学家对部长的倡议反应谨慎。 来自《简明英汉词典》

10 straightforward   

adj.正直的，坦率的；易懂的，简单的

参考例句：

• A straightforward talk is better than a flowery speech.巧言不如直说。
• I must insist on your giving me a straightforward answer.我一定要你给我一个直截了当的回答。

11 analysts   

分析家，化验员( analyst的名词复数 )

参考例句：

• City analysts forecast huge profits this year. 伦敦金融分析家预测今年的利润非常丰厚。
• I was impressed by the high calibre of the researchers and analysts. 研究人员和分析人员的高素质给我留下了深刻印象。

12 ongoing   

adj.进行中的，前进的

参考例句：

• The problem is ongoing.这个问题尚未解决。
• The issues raised in the report relate directly to Age Concern's ongoing work in this area.报告中提出的问题与“关心老人”组织在这方面正在做的工作有直接的关系。

13 volatility   

n.挥发性，挥发度，轻快，（性格）反复无常

参考例句：

• That was one reason why volatility was so low last year.这也是去年波动性如此低的原因之一。
• Yet because volatility remained low for so long,disaster myopia prevailed.然而，由于相当长的时间里波动性小，灾难短视就获胜了。

14 unemployed   

adj.失业的，没有工作的；未动用的，闲置的

参考例句：

• There are now over four million unemployed workers in this country.这个国家现有四百万失业人员。
• The unemployed hunger for jobs.失业者渴望得到工作。

15 labor   

n.劳动，努力，工作，劳工；分娩；vi.劳动，努力，苦干；vt.详细分析；麻烦

参考例句：

• We are never late in satisfying him for his labor.我们从不延误付给他劳动报酬。
• He was completely spent after two weeks of hard labor.艰苦劳动两周后，他已经疲惫不堪了。

16 extraordinarily   

adv.格外地；极端地

参考例句：

• She is an extraordinarily beautiful girl.她是个美丽非凡的姑娘。
• The sea was extraordinarily calm that morning.那天清晨，大海出奇地宁静。

17 sector   

n.部门，部分；防御地段，防区；扇形

参考例句：

• The export sector will aid the economic recovery. 出口产业将促进经济复苏。
• The enemy have attacked the British sector.敌人已进攻英国防区。

18 eroded   

adj. 被侵蚀的，有蚀痕的 动词erode的过去式和过去分词形式

参考例句：

• The cliff face has been steadily eroded by the sea. 峭壁表面逐渐被海水侵蚀。
• The stream eroded a channel in the solid rock. 小溪在硬石中侵蚀成一条水道。