6.15.2023

Rates Stay Steady 

The Federal Reserve yesterday held off on raising interest rates for the first time since its historic campaign to curb inflation began 15 months ago, giving it more time to assess the impact of previous hikes on the economy. The Fed's decision leaves the benchmark federal funds rate at its current range of 5% to 5.25%, ending a streak of 10 consecutive increases.

The temporary rate hike pause comes after the government's latest data showed inflation in May rose 4% year-over-year, a decrease from April's 4.9% and the 11th consecutive month of slowing inflation. The 4% rate is the smallest annual inflation growth since March 2021. Still, Federal Reserve officials suggested rate increases could resume later this year, with two more quarter percentage point moves, as inflation remains above the central bank's 2% target. 

Policymakers also released updated economic projections (see here), forecasting the economy to grow 1% this year, up from March's estimate of 0.4%. Inflation is expected to cool to 3.2% at the end of 2023 and to 2.5% at the end of 2024. 

Life's Building Blocks

One of Saturn's 146 moons harbors the fundamental elements required for the development of organic life, according to new data from NASA published yesterday. The discovery was made on Enceladus, an Arizona-sized lunar body with a salty subsurface ocean. 

Six elements—hydrogen, carbon, oxygen, nitrogen, sulfur, and phosphorus—are generally considered critical to the structure of organic life, with the latter two playing roles in nucleic and amino acids. Scientists confirmed the presence of the first five during previous missions; NASA's Cassini spacecraft has now confirmed the presence of phosphorous in ice particles ejected by high-powered geysers on the moon's surface.

Researchers say there is no evidence to date of actual life on Enceladus—a question that may be the focus of future missions—but the findings suggest other moons in the solar system may be ripe for similar investigations. Learn more about the icy moon here.

Migrant Boat Capsizes 

At least 78 migrants en route to Italy from Libya drowned Wednesday after their boat capsized off the southwestern coast of Greece, marking the deadliest such event in Greek waters this year. Over 100 migrants were rescued, although authorities expect the death toll to rise.

The Central Mediterranean migrant route—from North Africa to Italy and Greece—has seen a surge in crossings this year, recording its deadliest first quarter since 2017. The United Nations describes the route, where nearly 27,000 migrants have gone missing since 2014, as the most dangerous in the world. Overall, 70,000 migrants have arrived via sea in Europe in 2023, with roughly 80% reaching Italy, distantly followed by Spain and Greece (see numbers).

The tragedy comes less than a week after European Union ministers agreed to a rare migration reform deal. The so-called mandatory solidarity plan is designed to streamline relocation efforts while offering EU countries discretion to receive refugees or pay into a fund. 

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