> I would love to understand why the fed hasn't increased interest rates to counter the rapid increase of inflation..?
One reason is that they are still purchasing assets in order to goose the economy. It doesn't make any sense to be revving the economy with one hand while tamping it down with the other plus the point of the buying is to artificially depress interest rates. IIRC at the last meeting they announced that they would accelerate the tapering down of asset purchases so that they would be done in March.
They also like to move slowly which is why they don't just halt the asset purchases and start raising rates. They treat the economy with kid gloves so they don't break it (right or wrong, for better or for worse, that's how it goes).
One reason is that they are still purchasing assets in order to goose the economy. It doesn't make any sense to be revving the economy with one hand while tamping it down with the other plus the point of the buying is to artificially depress interest rates. IIRC at the last meeting they announced that they would accelerate the tapering down of asset purchases so that they would be done in March.
They also like to move slowly which is why they don't just halt the asset purchases and start raising rates. They treat the economy with kid gloves so they don't break it (right or wrong, for better or for worse, that's how it goes).