The Federal Reserve hiked interest rates by three-quarters of a percentage point on Wednesday, as expected, in the latest push to tame inflation, stabilize the economy and ease the pressure on families and businesses nationwide.
The rate increase is the fourth hike this year and matched a similarly aggressive move last month. Inflation has continued to climb, with Russia’s invasion of Ukraine adding pressure to prices and global economic activity, according to a statement released with the Fed’s rate hike decision.
Still, there are signs that parts of the economy are slowing down as the Fed ramps up its policies.
“Recent indicators of spending and production have softened,” the statement read. “Nonetheless, job gains have been robust in recent months, and the unemployment rate has remained low."
5 economic forces behind the Fed’s next rate-hike decision
Interest rates are the Fed’s most important tool for combating inflation now at 40-year highs. Higher rates make a range of lending — including mortgages and business loans — more expensive and are designed to cool demand in the economy.
The rate increase is the fourth hike this year and matched a similarly aggressive move last month. Inflation has continued to climb, with Russia’s invasion of Ukraine adding pressure to prices and global economic activity, according to a statement released with the Fed’s rate hike decision.
Still, there are signs that parts of the economy are slowing down as the Fed ramps up its policies.
“Recent indicators of spending and production have softened,” the statement read. “Nonetheless, job gains have been robust in recent months, and the unemployment rate has remained low."
5 economic forces behind the Fed’s next rate-hike decision
Interest rates are the Fed’s most important tool for combating inflation now at 40-year highs. Higher rates make a range of lending — including mortgages and business loans — more expensive and are designed to cool demand in the economy.