Federal Reserve Increases Benchmark Rate by 25 Basis Points Despite Bank Turmoil

The Federal Reserve decided on a quarter percentage point interest rate increase, expressing caution about the recent banking crisis and indicating that hikes are nearing an end. This is the Federal Reserve’s ninth hike since March 2022. The increase takes the benchmark federal funds rate to a target range between 4.75% to 5%.

“The Committee will closely monitor incoming information and assess the implications for monetary policy,” the Federal Open Market Committee’s post-meeting statement said. “The Committee anticipates that some additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time.“

The statement eliminated all references to the impact of Russia’s invasion of Ukraine.

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