Today, Congresswoman Maxine Waters (D-CA), the top Democrat on the House Financial Services Committee, released this statement following the Federal Reserve’s Federal Open Market Committee (FOMC) decision to raise interest rates by a quarter of a percentage point.

“Less than a month from a catastrophic default on our nation’s debt due to Republicans’ reckless games and two days after the third major bank failure of the year, the Federal Reserve has again decided to raise interest rates. While I acknowledge the FOMC signaled they may finally pause their aggressive rate hikes, it is well past time that they do so. As I highlighted back in November, experts warned that the Fed’s aggressive rate hikes may be over-correcting for inflation and that it was important to pause and assess the impact of these rate hikes since it takes time for their full effect to be realized in the economy. Since then, we’ve seen Republicans engage in a dangerous form of brinksmanship with our nation’s full faith and credit, along with turmoil in the banking sector. It would be prudent for the Fed to allow for some time to pass to better assess the full impact of their rate hikes in the midst of a rapidly evolving economic landscape.

“I am especially concerned about the further harm this additional hike will pose to the housing market, and our nation’s workers and small businesses. Not to mention, while the Fed has a dual mandate to promote stability and economic employment, these hikes may very well have the exact opposite effect and instead push our country into a recession. While I hope it’s not too late, I nevertheless implore the Fed to heed the concerns I shared in November before our economy is faced with a catastrophe that our most vulnerable communities will be forced to bear the brunt of.”

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Background:

• On November 4, 2022, then Chairwoman Waters sent a letter to Federal Reserve Chair Jerome Powell warning him about the consequences of interest rate hikes, and urging caution to avoid recession.
  
  
  

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