The US central bank have raised the country’s key interest rate by 25 basis points to 4.75-5.00 per cent range.
US central bank delivers small rate hike
The Federal Reserve has raised interest rates by a quarter of a percentage point but indicated it is on the verge of pausing further increases in borrowing costs amid recent turmoil in financial markets spurred by the collapse of two US banks.
The move set the US central bank’s benchmark overnight interest rate in the 4.75-5.00 per cent range, with updated projections showing 10 of 18 Fed policy makers still expect rates to rise another quarter of a percentage point by the end of this year, the same endpoint seen in the December projections.
But in a key shift driven by the sudden failures this month of Silicon Valley Bank (SVB) and Signature Bank, the Fed’s latest policy statement no longer says that “ongoing increases” in rates will likely be appropriate.
That language had been in every policy statement since the March 16, 2022 decision to start the rate hiking cycle.