Fed Raises Rates Quarter-Point, Signals Another Increase This Year

The Federal Reserve raised interest rates by a quarter percentage point Wednesday, delivering its first increase since July 2023 as policymakers responded to renewed inflation pressures. 

The unanimous decision by all 12 voting members of the Federal Open Market Committee lifted the federal funds rate’s target range to 3.75% to 4%. 

Fed officials also signaled that additional tightening is likely. Eighteen of the 19 policymakers who submitted economic projections anticipated at least one more quarter-point increase by the end of the year. Four officials projected that rates would need to rise by another half percentage point in 2026, implying two additional quarter-point moves.

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