"Federal Reserve Officials Concerned as Neutral Rate Rises, Impacting Stock Market"

Federal Reserve officials expect borrowing costs to remain elevated for years to come, signaling that the era of ultralow interest rates may be over. While they do not anticipate rates to go much higher, they forecast their benchmark short-term interest rate to stay above 5 percent next year and nearly 4 percent by the end of 2025. This suggests that higher rates may be here to stay for years, as the economy has proven resilient to rate increases. The Fed's new outlook of "higher for longer" has implications for households, investors, and the overall economy, potentially impacting mortgage rates, corporate profitability, and government debt. However, economic forecasts are uncertain, and the Fed's rate predictions may not materialize if the economic recovery falters.