US Federal Reserve Raises Interest Rates for First Time Since 2023
The US Federal Reserve raised interest rates by 0.25 percentage points, bringing its benchmark rate to a range of 3.75% to 4%. This marks the first increase since July 2023 and reflects ongoing efforts to control inflation, which remains above target levels according to Fed Chair Kevin Warsh. The decision has sparked political tension with former President Donald Trump, who criticized the move on Truth Social, advocating for lower rates. The Fed also indicated a potential additional rate hike before year-end, though it acknowledged economic growth and employment outlooks remain positive. However, inflation is expected to take until 2029 to return to its 2% target due in part to ongoing geopolitical tensions affecting energy prices. The recent conflict between the US and Iran has contributed to rising oil prices, which have pushed up gas and diesel costs significantly compared to last year. The bond market reacted with a sell-off, pushing yields on 10-year Treasury notes to their highest level in nearly two decades.
Topics: Donald Trump Federal Reserve inflation interest rates Kevin Warsh