First published by Money Metals Exchange here:
https://www.moneymetals.com/news/2023/03/01/catch-22-rate-hikes-may-fuel-even-more-inflationary-deficit-spending-002691
Federal Reserve rate hikes meant to quell inflation may ultimately have the opposite effect. Of course, higher borrowing costs will force consumers to scale back and businesses to trim payrolls. A contraction in debt-financed economic activity will in theory cause inflation to fall.
