The Fed Is Raising Interest Rates By 25 Basis Points

The Federal Reserve of the United States said today that interest rates will be raised from 4.50% to 4.75%, a 0.25% increase from last month’s rate. Rates were still at 0%, which was lower than a year earlier.

Rates ranging from 4.50% to 4.75%

The Fed is raising interest rates by 25 basis points.

The Federal Reserve of the United States said today during the Federal Open Market Committee that it would raise federal interest rates by 0.25%, putting them to a range of 4.50% to 4.75%.

The rate hike was widely anticipated by markets, with analysts pricing a 25 basis point boost at 98% and a 50 basis point hike at 2%.

The Fed has hiked interest rates for the seventh time since the beginning of 2022. In November 2021, the central bank detailed its plan to tighten monetary conditions in order to combat galloping inflation; interest rates were at 0% at the time. After being chastised for failing to take inflation fears seriously, the Fed proceeded fast to raise interest rates on a monthly basis, first by 25 points, then 50 points, and finally 75 points on repeated times. In other words, the bank raised borrowing costs, which boosted the value of the dollar.

However, the Fed’s hawkishness has been questioned by a number of organizations, including the United Nations, which cautioned in October that hiking interest rates too quickly risked precipitating a global recession. The Fed finally slowed the pace of its rate hikes last month, raising rates by 50 basis points rather than 75. The decision made today is another step in that direction.

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