Fed Raises Rates 25 Basis Points, Signals Another Hike This Year
- On Wednesday, the Federal Reserve unanimously voted to raise interest rates to between 3.75 and 4.00 per cent, marking the first increase in three years.
- Persistent inflation driven by rising oil prices during the U.S.-Israeli conflict with Iran prompted the action, as officials aimed to support a "timelier return" to their 2 per cent target.
- Fed Chairman Kevin Warsh emphasized that "the plain fact is that inflation is too high and has been for too long," while the Dow Jones Industrial Average tumbled more than 850 points after the announcement.
- Following the announcement, the two-year Treasury yield jumped to 4.73% from 4.67% late Tuesday, while JPMorgan Chase fell 2%, one of the market's heaviest weights.
- Projections published Wednesday show at least 12 of 18 policymakers expect another rate hike before year-end, with the median forecast suggesting the federal funds rate will reach 4.1%.
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400 Articles
U.S. Fed hikes rates in push for 'timelier' drop in inflation
U.S. Federal Reserve Chair Kevin Warsh says the central bank raised interest rates by a quarter of a percentage point to address inflation, which remains above its 2 per cent target, and flagged further increases in borrowing costs in coming months.
Why Mortgage Rates Shot Toward 7% Before the Fed Raised Rates
The Federal Reserve just raised the target for the federal funds rate 25 basis points, or a quarter of a percentage point. It's the first increase to the funds rate since July 2023. Mortgage rates, on the other hand, have…
Why Mortgage Rates Shot Toward 7% Before the Fed Raised Rates
The Federal Reserve just raised the target for the federal funds rate 25 basis points, or a quarter of a percentage point. It's the first increase to the funds rate since July 2023. Mortgage rates, on the other hand, have…
When appointing Kevin Warsh as head of the US central bank in May, Donald Trump expected interest rate cuts and a weakening dollar. Four months later, the cost of money is rising and the dollar is strengthening. "By raising interest rates, the Fed won't lower oil prices," Piotr Kuczyński, an analyst at Xelion Investment House, reminded TVN24 BiS.
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