Fed raises federal funds rate by 75 basis points
United States Federal Reserve's Federal Open Market Committee (FOMC) revealed on Wednesday that it will raise the target range for the federal funds rate by 0.75 percentage points to between 3.75% and 4%, emphasizing that "ongoing increases in the target range will be appropriate" to reach a monetary policy stance deemed "sufficiently restrictive" to drive inflation down to the Fed's 2% goal.
This is the US central bank's fourth consecutive 75 basis point rate hike and the decision has been made unanimously. "In determining the pace of future increases in the target range, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments," the central bank specified.
The Fed described spending and production growth as "modest," job gains as "robust," while seeing low unemployment and "elevated" inflation at the same time.