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Fed Hikes Interest Rates 0.75% as It Struggles Against Highest Inflation in Decades

The Federal Reserve launched another sortie against the fastest inflation in four decades on Wednesday, approving the fourth straight supersized rate increase and signaling more increases were likely in the months ahead.

Fed officials agreed Wednesday to lift the benchmark federal-funds rate by three-quarters of a percentage point to a range between 3.75 and four percent, the highest since January 2008. This was what forecasters and financial markets had expected. This is the fourth consecutive raise of 75 basis points.

The Fed’s statement indicated more hikes ahead but appeared to leave room for the Fed to slow the pace of rate hikes at future meetings while the Fed watches for delayed effects of already enacted rate increases.

“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 Federal Open Market Committee said.

Equity markets saw this as a softening of the Fed’s stance, pushing stock prices up in the immediate market reaction to the announcement. The dollar, which has strengthened against foreign currencies as interest rates have climbed, moved lower.

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7 thoughts on “Fed Hikes Interest Rates 0.75% as It Struggles Against Highest Inflation in Decades”

  1. Government f ups everything they touch.
    Thru life everything government got involve in I just stop doing cause they just plain destroy any enjoyment from it

  2. High interest rates reward those of us who have saved more than we have spent. Seems like a good and moral thing to me.

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