The Federal Reserve must make one of the most consequential decisions of its rate-raising campaign this week as it considers whether to implement another increase without knowing if efforts to shore up the banking sector will work in the long term.
Central bank officials will gather on Tuesday for their latest two-day meeting, at which they must decide whether to press ahead with another quarter-point rate rise or forgo an increase.
The dilemma comes as global authorities have acted swiftly to support the financial system in the wake of Silicon Valley Bank’s collapse earlier this month, with the Fed rolling out a new facility to aid lenders and the Swiss government brokering a hasty takeover of a faltering Credit Suisse by UBS.