US Fed raises key interest rate for 1st time since 2023
WASHINGTON (Kyodo) -- The U.S. Federal Reserve on Wednesday raised its benchmark interest rate for the first time since July 2023 and suggested furthe
The U.S. Federal Reserve has increased its key interest rate for the first time since July 2023. The Federal Open Market Committee unanimously decided on a 0.25 percentage point hike, raising the federal funds rate target range to 3.75 to 4 percent. This move aims to curb resurgent inflation caused by the war in Iran. Twelve of the 18 policymakers indicated another quarter-point hike by the end of this year, while four proposed two more hikes, and two suggested keeping the rate at the new level.
The Fed, no longer on the rate-cut trajectory, now focuses on price stability rather than maximum employment. Despite economic activity expanding at a solid pace, inflation remains elevated, staying above the Fed's 2 percent target for over five years. The decision comes amid geopolitical tensions and rising consumer prices. Fed Chair Kevin Warsh, appointed by President Trump, emphasized the importance of price stability, stating that inflation has been too high and persistent for too long.
Trump, however, has called for lower interest rates, arguing that the U.S. is the best credit in the world.
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Also reported by 1 other outlet
- US Fed Raises Benchmark Interest by 0.25%P to Target of 3.75%~4% world.kbs.co.kr
