The Federal Reserve raises interest rates by 25 basis points under Chairman Kevin Warsh

MILAN – The Federal Reserve raises interest rates in the third board meeting with Kevin Warsh as president. The cost of money, in line with expectations, rises from the range between 3.50% and 3.75% to between 3.75% and 4%. This is the first increase since July 2023: since then, before today's decision, the FOMC had reduced rates six times, for a total of 175 basis points. The decision was taken unanimously. An increase that goes against the wishes of President Trump, who is absolutely against an increase in the cost of money, and which may not be enough. In fact, the Federal Reserve sees another rate hike by the end of the year to combat inflation. This was reported in the note released at the end of the FOMC meeting which decided with a unanimous vote (12 to zero) to raise rates by 25 basis points to 3.75%-4%. During the two-day closed-door meeting, the FOMC revised its forecasts for the US economy: inflation to 3.7% on an annual basis by the end of 2026, according to the median of the projections, compared to the 3.6% estimated at the June meeting. Benchmark interest rates will be between 4%-4.25% by the end of the year, above the level announced today.