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How do the Fed's higher interest rates affect the stock market? 

— Eddie

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The US Federal Reserve is likely to deliver a third consecutive interest rate hike this week.

Consumers should expect their costs to head even higher and job losses to mount as economic growth grinds to a halt

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The dual fear of higher rates and recession (or stagflation) are pressuring stocks, and many market strategists think stocks have another low in them this year. 

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The S&P 500 officially fell earlier this summer into a bear market, which means the index is down at least 20% from its record high in January

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and had climbed back on hopes the Fed's aggressive rate hikes would ease.

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But August's consumer inflation report extinguished those hopes, and many economists now expect rates will have to rise higher and stay there longer 

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Higher rates make borrowing and business investment more expensive and cools consumer spending, which cuts into corporate profits. 

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