U.S. Chamber Sees 'Little Reason' for a Half-Point Rate Increase

WASHINGTON, D.C. – The United States Chamber of Commerce called today's half percentage point increase, the sixth overall for a total of one and three-quarter percentage points, a marked escalation in the Federal Reserve's war on anticipated inflation.

"While no one in the business community wants to see an acceleration in inflation, we hope that the Fed will not kill our record-breaking expansion in the process," said Chamber chief economist Dr. Martin Regalia.

Inflation, while up modestly in recent months owing to spiking oil prices, has shown virtually no acceleration at the core level and oil prices have since moderated.

"There seems to be little reason for the Fed to have abandoned its relatively conservative approach of quarter point increases and adopt the more aggressive approach of half point increases," said Regalia. "It often takes over a year before interest rate changes affect the economy and the Fed began to tighten less than 12 months ago."

The Fed's move, apparently in response to expectations voiced on Wall Street, is likely to have its most serious casualties among Main Street's small businesses, according to the Chamber.

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.

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