Updated on 17 mins ago
Fed raises interest rates by 75 basis points in another historic move to tackle inflation
Inflation soared to a fresh 40-year high in June, further raising pressure on Fed officials
By Megan Henney FOXBusiness
The Federal Reserve on Wednesday raised its benchmark interest rate by 75 basis points for the second straight month as it tries to bring scorching-hot inflation under control, a move that threatens to slow U.S. economic growth and exacerbate financial pressure on Americans.
The three-quarter percentage point hikes in June and July – the first since 1994 – underscore just how serious Fed officials are about tackling the inflation crisis after a string of alarming economic reports.
The widely expected move puts the key benchmark federal funds rate at a range between 2.25% to 2.50%, the highest since the pandemic began two years ago. It marks the fourth consecutive rate increase this year; investors will be closely watching Fed Chairman Jerome Powell's press conference after the decision for signs of how long the rapid pace of rate hikes will continue.
Hiking interest rates tends to create higher rates on consumer and business loans, which slows the economy by forcing employers to cut back on spending. Mortgage rates have nearly doubled from one year ago to 5.14%, the highest since 2008, while some credit card issuers have ratcheted up their rates to 20%.
more
https://www.foxbusiness.com/economy/fed-raises-interest-rates-75-basis-points-another-historic-move-tackle-inflation
