Sign up for our daily briefing
Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.
Stay on top of the latest market trends
Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.
Sports news worthy of your time
Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.
Tech news worthy of your time
Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.
Get the inside stories
Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.
Catch up on coronavirus stories and special reports, curated by Mike Allen everyday
Catch up on coronavirus stories and special reports, curated by Mike Allen everyday
Want a daily digest of the top Denver news?
Get a daily digest of the most important stories affecting your hometown with Axios Denver
Want a daily digest of the top Des Moines news?
Get a daily digest of the most important stories affecting your hometown with Axios Des Moines
Want a daily digest of the top Twin Cities news?
Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities
Want a daily digest of the top Tampa Bay news?
Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay
Want a daily digest of the top Charlotte news?
Get a daily digest of the most important stories affecting your hometown with Axios Charlotte
Cliff Owen/AP
The Federal Reserve will raise the rate at which banks borrow 0.25% to 1.125%, the fourth such increase since December of 2015. The move was announced Wednesday following the Fed's June meeting, and suggests Fed Chair Janet Yellen thinks the steadily falling unemployment rate will soon spark faster wage growth and overall price increases.
Not so fast: The board's statement was more cautious than the one it issued in March — reflecting the fact that core inflation growth has fallen for three straight months, a trend Ian Shepherdson of Pantheon Macroeconomics calls "alarming, but not definitive." In other words, the Fed is currently sticking to its belief that inflation is going to accelerate this year — and that they must raise rates to head it off — but incoming data could cause it to abandon that view before July's meeting.
What it means for workers: The Fed thinks the U.S. economy is at full employment, and that significant further declines in the unemployment rate could spark a dangerous inflationary cycle. The concern is that low joblessness forces employers to pay higher wages, which then ups prices for products and services throughout the economy.