The Fed anticipates rising rates to 5.1% before defeating inflation.

By The Exchange Team

As per its median forecast given Wednesday, the Federal Reserve will raise interest rates to 5.1% in 2023 before ending its inflation struggle.

The predicted "terminal rate" of 5.1% is 5%-5.25%. The Fed forecasted 4.6% in September.

On Wednesday, the Fed raised rates by 50 basis points to a 15-year high of 4.25% to 4.5%.

The Fed's dot plot revealed 17 of 19 "dots" would raise interest rates above 5% in 2023.

Seven of the committee's 19 members predicted that rates would rise above 5.25% next year.

The rate-setting Federal Open Market Committee forecasted a 4.1% rate drop in 2024.

The committee also upped its median core inflation forecast to 4.8%, up 0.3 percentage points from September.