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- SpaceX launches mission to return stranded astronauts
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- SpaceX set to launch mission to return stranded astronauts
- Storm Helene kills 44, threatens more 'catastrophic' flooding
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- US hurricane deaths rise to 44, fears of more 'catastrophic' flooding
- Global stocks mostly rise, cheering Beijing stimulus
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- Global stocks rise on rate hopes, Beijing stimulus
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- Chinese stocks extend surge, Europe higher on Beijing stimulus
- Pope says Church must 'seek forgiveness' for child sexual abuse
- China caps week of 'bazooka' stimulus for ailing economy with rate cut
- Cuts, cash, credit: China bids to jumpstart flagging economy
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- China cuts amount banks hold in reserve to boost lending
- Hong Kong, Shanghai extend surge as China optimism boosts markets
- Vietnam president reiterates support for Cuba during official visit
- Drought reduces Amazon River in Colombia by as much as 90%: report
- Stay or go? Pacific Islanders face climate's grim choice
- Florida bracing for 'unsurvivable' Hurricane Helene
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- Chloe's see-through look may not be for Kamala Harris
- Champagne houses abuzz over English sparkling wine
- Macron, Trudeau pledge to work for 'decarbonized' economies
- Hurricanes, storms, typhoons... Is September wetter than usual?
- China stimulus, tech optimism boost stock markets
- 'Unsurvivable' Hurricane Helene races towards Florida
- Macron meets Trudeau in Canada as both face political setbacks
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- Floods threaten Niger's historic 'gateway to the desert'
Fed begins policy meeting as it prepares to raise interest rates
The Federal Reserve opened its two-day policy meeting on Tuesday as it prepares to raise borrowing rates for the first time since the pandemic began in an effort to tamp down rising inflation.
Policymakers face a difficult task of trying to contain prices without stamping out economic growth as costs for housing, food and energy rise at rates not seen for 40 years and the economic fallout from the Russian invasion of Ukraine makes the situation worse.
A Fed spokesperson confirmed the meeting began as scheduled at 1300 GMT, and markets will get the decision on Wednesday at 1900 GMT, which is expected to see the benchmark interest rate rise by 0.25 percentage points from zero, where it has been since March 2020.
Fed Chair Jerome Powell "will be walking a tightrope, balancing the needs to raise rates and rein in a more systemic rise in inflation with the need to avert a meltdown in credit markets," Grant Thornton chief economist Diane Swonk said.
"The collapse of the economy in 2008-09 proved that financial crises are much harder to recover from than a Fed-induced slowdown."
Powell has expressed confidence that the central bank is well equipped to handle inflation risks, but has acknowledged the uncertainty surrounding the impact of the war.
The latest data confirmed the rising pressures as the US producer price index (PPI) rose 10 percent for the 12 months ended in February, and goods prices posted their highest monthly increase on record, largely due to energy, the Commerce Department reported Tuesday.
Oil prices have soared since the start of the war in Ukraine, but on Tuesday retreated below $100 a barrel amid optimism about peace talks between Kyiv and Moscow.
But investors are seeing rising credit costs in anticipation of a series of rate hikes by the Fed.
"It's a bit of tangled economic mess right now unfolding before our eyes, which is why the capital markets are a bit of a mess... trading in volatile fashion as investors struggle to figure out the implications of it all," Briefing.com analyst Patrick J O'Hare said in a commentary.
M.P.Jacobs--CPN