The US Federal Reserve raised rates for the first time in three years
Quick Look
- The US Federal Reserve raised its benchmark interest rate by 25 basis points to 3.75-4% per annum for the first time since July 2023.
- The decision coincided with analysts' forecasts.
- The Fed sees strong growth in economic activity and domestic spending despite high inflation and geopolitical uncertainty.
AI-generated summary
Why It Matters
The last Fed rate hike occurred in July 2023 to 5.25–5.5%. The current decision marks an easing of tight monetary policy after the worst tightening period in decades.
The US Federal Reserve raised the base interest rate for the first time in three years by 25 basis points, to 3.75-4% per annum.
The decision coincided with the forecast of analysts surveyed by the Trading Economics portal.
The Fed notes that the policy measures taken will help return inflation to the target of 2%.
MOSCOW, September 16 - RIA Novosti. Following the September meeting, the US Federal Reserve System (FRS) increased the base interest rate for the first time in three years - by 25 basis points, to 3.75-4% per annum, as follows from the regulator’s press release.
The decision coincided with the forecast of analysts surveyed by the Trading Economics portal.
The last time the US Federal Reserve raised the base rate was in July 2023 - to 5.25-5.5% per annum.
The regulator notes that economic activity is growing at a steady pace. Despite the continued high degree of uncertainty, driven in part by geopolitical events, domestic spending in the United States remains resilient.
Additionally, job growth has matched the increase in the labor force, and the unemployment rate has remained virtually unchanged. At the same time, inflation still remains at a high level.
What to Watch
AI outlook — possibilities, not facts
The Fed could continue to gradually cut rates through 2024, provided inflation stabilizes.
Likely · Within months
Open Questions
- Will the Fed continue its cycle of rate cuts in the coming months?
- How will geopolitical uncertainty affect future Fed decisions?
