While the economy appears to be moving in the right direction, the Fed noted in its minutes that inflation is"unacceptably high" and still remains well-above the pre-pandemic level of 2% — and it anticipates rate hikes will continue throughout 2023.
This means that while the Fed might lower the pace at which it raises interest rates throughout the year, taking on loans to buy a house, car, or mortgage will keep getting more expensive. The Fed's December minutes also emphasized that uncertainty going into this new year. It said that prices could stay high longer than anticipated if the labor market stays tight, and"China's relaxation of its zero-COVID policies, Russia's continuing war against Ukraine, and effects of synchronous policy firming by major central banks" raise other uncertainties in terms of their impacts on the US economy, as well.