https://sputnikglobe.com/20230201/us-federal-reserve-raises-interest-rates-by-25-basis-points-in-bid-to-ease-inflation-1106896587.html
US Federal Reserve Raises Interest Rates by 25 Basis Points in Bid to Ease Inflation
US Federal Reserve Raises Interest Rates by 25 Basis Points in Bid to Ease Inflation
Sputnik International
The US Federal Reserve announced on Wednesday that it would be raising interest rates by a quarter point, marking one of the smallest increases made by the panel in nearly a year in its effort to ease inflation.
2023-02-01T19:24+0000
2023-02-01T19:24+0000
2023-02-01T20:34+0000
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The US Federal Reserve announced on Wednesday that it would be raising interest rates by a quarter point (0.25%), marking one of the smallest increases made by the panel in nearly a year in its effort to ease inflation.The central bank previously hiked its interest rates eight times since March of 2022 (including four consecutive raises of 0.75% each) in an effort to cool skyrocketing inflation that hit a 40-year high.The increase matched the March 2022 hike of 25 basis points as the Fed began raising rates to counter runaway triggered by the trillions of dollars of government spending to fight the COVID-19 pandemic. After a 50-basis point hike that followed the one in March, the central bank embarked on four jumbo-sized 75-basis point increases between June and November, before returning to a 50-basis point hike in December after a visible retreat in inflation.Despite the smaller interest rate hike, the central bank has said inflation "eased somewhat" but that it is "still elevated."Federal Reserve Chairman Jerome Powell reiterated to reporters shortly after the announcement that while reduced inflation data over the last three months were "welcome," the agency "will need substantially more evidence to be confident that inflation is on a sustained downward path."Inflation rose by 6.5% within the last 12 months leading up to December. An inflation rate of 6.5% is about three times higher than the Federal Reserve's target rate of 2%.Forecasters have predicted that personal consumption expenditures (PCE) could drop to 3% by the end of 2023. Nanette Abuhoff Jacobson, a global investment strategist at Hartford Funds, is one of those forecasters; however, she has also warned that with early retirees leaving the workforce and a decrease on immigration, the effects of the COVID-19 pandemic on the economy will continue to sting even by the end of the year. The Federal Reserve believes it could take until 2025 until they are able to reach their target inflation rate of 2%.
https://sputnikglobe.com/20220930/us-investor-fed-interest-rate-hike-fueling-global-recession-1101398516.html
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US Federal Reserve Raises Interest Rates by 25 Basis Points in Bid to Ease Inflation
19:24 GMT 01.02.2023 (Updated: 20:34 GMT 01.02.2023) Though the interest hike may indicate an end to the Federal Reserve's aggressive move to fight soaring prices and cool the economy, reports are indicating that the fight against inflation is far from over.
The US Federal Reserve announced on Wednesday that it would be raising interest rates by a quarter point (0.25%), marking one of the smallest increases made by the panel in nearly a year in its effort to ease inflation.
The central bank previously hiked its interest rates eight times since March of 2022 (including four consecutive raises of 0.75% each) in an effort to cool skyrocketing inflation that hit a 40-year high.
"The Committee decided to raise the target range for the federal funds rate to 4.50 to 4.75 percent," the Federal Open Market Committee (FOMC) said in its monthly policy statement.
The increase matched the March 2022 hike of 25 basis points as the Fed began raising rates to counter runaway triggered by the trillions of dollars of government spending to fight the COVID-19 pandemic.
After a 50-basis point hike that followed the one in March, the central bank embarked on four jumbo-sized 75-basis point increases between June and November, before returning to a 50-basis point hike in December after a visible retreat in inflation.
Despite the smaller interest rate hike, the central bank has said inflation "eased somewhat" but that it is "still elevated."
“The Committee anticipates that ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time,” they added.
Federal Reserve Chairman Jerome Powell reiterated to reporters shortly after the announcement that while reduced inflation data over the last three months were "welcome," the agency "will need substantially more evidence to be confident that inflation is on a sustained downward path."
Inflation rose by 6.5% within the last 12 months leading up to December. An inflation rate of 6.5% is about three times higher than the Federal Reserve's target rate of 2%.
Forecasters have predicted that personal consumption expenditures (PCE) could drop to 3% by the end of 2023. 
30 September 2022, 23:47 GMT
Nanette Abuhoff
Jacobson, a global investment strategist at Hartford Funds, is one of those forecasters; however, she has also warned that with early retirees leaving the workforce and a decrease on immigration, the effects of the COVID-19 pandemic on the economy will continue to sting even by the end of the year.
The
Federal Reserve believes it could take until 2025 until they are able to reach their target inflation rate of 2%.
