2 hrs ago
Federal Reserve Raises Rates, Signals Another Hike Ahead
The Federal Reserve raised the cost of borrowing money in the United States.
The increase was one-quarter of a percentage point.
The new interest-rate range is 3.75% to 4%.
The Fed said prices are still rising faster than its 2% goal.
Higher energy costs and other price pressures also influenced its decision.
Higher rates can make home loans, business loans and credit more expensive.
Most Fed policymakers think rates may rise once more this year.
The Fed’s next scheduled meetings are in October and December 2026.
The Federal Reserve raised its benchmark interest rate by 25 basis points to a target range of 3.75%-4%.
The unanimous decision was the Fed’s first rate increase since July 2023.
Officials cited inflation above the 2% target, higher energy prices and continuing price pressures.
Sixteen of 18 policymakers projected at least one more 25-basis-point hike this year.
The Fed projected 2026 inflation of 3.7%, economic growth of 2.3% and a policy rate of 4%-4.25% by year-end.
- Who
- The Federal Reserve and its Federal Open Market Committee, whose 12 voting members unanimously approved the increase.
- What
- A 25-basis-point increase in the federal funds target range, bringing it to 3.75%-4%.
- Where
- The United States.
- When
- At the Fed’s latest policy meeting; the next scheduled meetings are in October and December 2026.
- Why
- Inflation remains above the Fed’s 2% target, while higher energy prices and continued price pressures persist.
Key facts
- Rate increase
- 25 basis points
- New target range
- 3.75%-4%
- Decision
- Approved unanimously by 12 voting members
- Previous hike
- The first increase since July 2023
- Further hike expectations
- Sixteen of 18 policymakers projected at least one more 25-basis-point increase this year
- 2026 inflation forecast
- 3.7%
- 2026 growth forecast
- 2.3%
Sources
Related news
Fed Raises Rates, Signals Another Hike Amid Higher Inflation
Federal Reserve Raises Rates Quarter Point Amid Persistent Inflation
Federal Reserve Raises Rates, Signals Another Hike This Year
Wall Street Turns Hawkish As Banks Forecast Fed Rate Hikes
Federal Reserve Raises Rates as Inflation Mounts, Defying Trump
Fed Rate Hike Leaves Treasury Yields Elevated Amid Inflation
White House Criticizes Fed Rate Hike Over Inflation Dispute
Gold falls after Fed rate hike boosts dollar
US Fed Rate Hike Puts India’s Markets Under Pressure
Gold Swings Lower After Fed Signals More Rate Hikes
