Markets have started showing jitters ahead of the Federal Reserve’s rate-setting meeting on Wednesday, with stock futures plunging to record lows on worries of a major hike in borrowing costs.
Dow Jones Industrial Futures were down 19 points on Monday, following a 939-point tumble on Friday over investors’ worries on several issues including the Russia-Ukraine war, rampant inflation, and aggressive rate hikes from the Fed.
The Nasdaq 100 futures plunged 47 points in its worst week since 2008.
The Fed’s monetary policy committee is expected to raise its key interest rate by 50 basis points while also making massive cuts in its stimulus program, which reached $9 trillion during the pandemic, during its policy meeting on Wednesday.
Fed Chair Jerome Powell had signaled last month in an IMF seminar that “50 basis points will be on the table for the May meeting.”
In March, the central bank approved an increase of 25 basis points in the key rate, it’s first since 2018.
The move would be in line with efforts to tame inflation, which has already soared to 8 percent in the U.S.
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