The increase in the Fed's short-term interest rate moved it to a range of 0.75% to 1%, the highest point since the pandemic struck two years ago.
WASHINGTON — The Federal Reserve intensified its fight against the worst inflation in 40 years by raising its benchmark interest rate by a half-percentage point Wednesday — its most aggressive move since 2000 — and signaling further large rate hikes to come.
It will be a delicate balancing act. The Fed has endured widespread criticism that it was too slow to start tightening credit, and many economists are skeptical that it can avoid causing a recession. At his news conference, Powell stressed his belief that “restoring price stability” — that is, curbing high inflation — is essential to sustaining the economy’s health.
Powell has said he wants to quickly raise the Fed’s rate to a level that neither stimulates nor restrains economic growth. Fed officials have suggested that they will reach that point, which the Fed says is about 2.4%, by year’s end. Yet by most measures, the overall economy remains healthy. This is especially true of the U.S. job market: Hiring is strong, layoffs are few, unemployment is near a five-decade low and the number of job openings has reached a record high.
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Fed raises key rate by a half-point in bid to tame inflationThe Federal Reserve intensified its drive to curb the worst inflation in 40 years by raising its benchmark short-term interest rate by an sizable half-percentage point
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Fed raises key rate by a half-point in bid to tame inflationThe Federal Reserve intensified its drive to curb the worst inflation in 40 years by raising its benchmark short-term interest rate by an sizable half-percentage point
Read more »
Fed raises key interest rate by a half-pointThe increase in the Fed’s key rate raised it to a range of 0.75% to 1%, the highest point since the pandemic struck two years ago.
Read more »