Fed Raises Interest Rates Another Quarter Point - Modern Distribution Management

Log In

Fed Raises Interest Rates Another Quarter Point

The increase follows a one-month pause in June and despite recent sharp declines in wholesale and consumer inflation rates.
Federal reserve

Despite sharp declines in wholesale and consumer inflation in recent months, the U.S. Federal Reserve said July 26 that it will raise federal interest rates another quarter point. The central bank had issued a rate increase every month since March 2022 until a one-month pause this past June.

The latest increase will move the Fed’s funds rate to 5.25-5.5% — the highest such rate in 22 years — as it looks to thwart inflation and ultimately return U.S. inflation to a rate of 2% over the long-term.

“Recent indicators suggest that economic activity has been expanding at a moderate pace,” the Fed’s Federal Open Market Committee release stated. “Job gains have been robust in recent months, and the unemployment rate has remained low. Inflation remains elevated.

“Tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation. The extent of these effects remains uncertain.”

The U.S. Producer Price Index for final demand increased just 0.1% in June year-over-year, showing that inflation continues to slow, the U.S. Bureau of Labor Statistics reported July 13. The increase in wholesale prices over the past 12 months slowed from 1.1% in May. June’s rate was the lowest reading since September 2020.

Meanwhile, the U.S. Labor Department reported July 12 that the Consumer-Price Index climbed 3% in June compared with a year earlier — its slowest pace in more than two years. That consumer inflation mark came in at just one-third of last summer’s roughly 9% peak, when the price of gasoline reached a record average of $5 per gallon.

Related Posts

Share this article

About the Author
Recommended Reading
Leave a Reply

Leave a Comment

Sign Up for the MDM Update Newsletter

The MDM update newsletter is your best source for news and trends in the wholesale distribution industry.

Get the MDM Update Newsletter

Wholesale distribution news and trends delivered right to your inbox.

Sign-up for our free newsletter and get:

  • Up-to-date news in a quick-to-read format
  • Free access to webcasts, podcasts and live events
  • Exclusive whitepapers, research and reports
  • And more!


articles left

Want more Premium content from MDM?

Subscribe today and get:

  • New issues twice each month
  • Unlimited access to mdm.com, including 10+ years of archived data
  • Current trends analysis, market data and economic updates
  • Discounts on select store products and events

Subscribe to continue reading

MDM Premium Subscribers get:

  • Unlimited access to MDM.com
  • 1 year digital subscription, with new issues twice a month
  • Trends analysis, market data and quarterly economic updates
  • Deals on select store products and events



You have one free article remaining

Subscribe to MDM Premium to get unlimited access. Your subscription includes:

  • Two new issues a month
  • Access to 10+ years of archived data on mdm.com
  • Quarterly economic updates, trends analysis and market data
  • Store and event discounts

To continue reading, you must be an MDM Premium subscriber.

Join other distribution executives who use MDM Premium to optimize their business. Our insights and analysis help you enter the right new markets, turbocharge your sales and marketing efforts, identify business partners that help you scale, and stay ahead of your competitors.

Register for full access

By providing your email, you agree to receive announcements from us and our partners for our newsletter, events, surveys, and partner resources per MDM Terms & Conditions. You can withdraw consent at any time.

Learn More about Custom Reports

Request a Market Prospector Demo

  • This field is for validation purposes and should be left unchanged.