As Fed Meets, Investor Angst Over Rate Hikes Spooks Markets

By CHRISTOPHER RUGABER, AP Economics Writer

WASHINGTON (AP) — Wild volatility in the stock market this week has put heightened scrutiny on the Federal Reserve's meeting Wednesday and whether the Fed will clarify just how fast it plans to tighten credit and potentially slow the economy.

With high inflation squeezing consumers and businesses, the Fed is expected to signal that it will raise its benchmark short-term interest rate in March in a sharp reversal from the ultra-low rate policies it imposed after the pandemic recession erupted two years ago.

To further tighten credit, the Fed plans to end its monthly bond purchases in May. And later this year, it may start reducing its huge stockpile of Treasury and mortgage bonds.