Fed raises US rates to tackle ‘too high’ inflation, irking Trump
WASHINGTON - The US Federal Reserve on Wednesday raised interest rates for the first time since 2023, defying President Donald Trump’s demand for cuts, as central bank chief Kevin Warsh stressed the need to combat inflation that has been “too high” for “too long.”
The US Federal Reserve, on Wednesday, increased interest rates for the first time since 2023, in defiance of President Donald Trump's call for rate cuts. The Federal Open Market Committee voted unanimously to raise rates by 25 basis points, between 3.75% and 4.00%. Kevin Warsh, the Fed's chief, emphasized the necessity of this decision, stating, "The plain fact is that inflation is too high, and has been for too long."
This rate hike may not be the last; most Fed policymakers indicated at least one more rate hike was likely before the year's end. US households and businesses have struggled with years of inflation above target levels, with prices surging due to Trump's actions, including his war on Iran, tariff policies, and the AI boom. The president reacted angrily, calling the Fed's decision a "raise against Trump" and accusing it of making politically motivated choices.
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