On Wednesday the Federal Reserve raised interest rates by 25 basis points, an increase of 0.25%. As a result, interest rates continue to slowly rise and are now in a range of 4.5% to 4.75%. This is the highest figure since September 2007.
The Fed said in a statement that "recent indicators point to modest growth in spending and production. Job gains have been robust in recent months, and the unemployment rate has remained low. Inflation has eased somewhat but remains elevated."
Federal Open Market Committee statement: https://t.co/TGwUPxlYZu #FOMC
— Federal Reserve (@federalreserve) February 1, 2023
The Fed's monetary committee warns of future rate hikes: "Ongoing increases in the target range" will still be necessary "in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to two percent over time."
At its last meeting last year, the Federal Reserve raised its benchmark interest rate by 0.5%. It was the seventh increase of the year and followed four consecutive aggressive 75 basis point hikes. This time, the increase was more moderate.
In any case, interest rates are expected to range between 5.1% and 5.25% by 2023.