The Fed said in a statement, Wednesday, that it raised interest rates by 25 basis points, to settle in the range of 5 percent — 5.25 percent, the highest level in 16 years.
The increase in interest rates comes despite banking and economic risks facing the United States, which witnessed in the last two months the collapse of 3 banks and indications of a recession by the last quarter of 2023, reports Al-Qabas daily.
The Fed emphasized the integrity and resilience of the banking system, noting that tougher credit conditions are likely to affect households and businesses, the economy, employment and inflation.
The US Federal Reserve raised interest rates on federal funds by 25 basis points, in an increase that matched market expectations.
The sources added, “The Federal Open Market Committee seeks to achieve maximum employment, while targeting inflation at 2 percent in the long term.”
The latest inflation data in the US market, for the month of March, was about 5 percent, down from the 41-year peak recorded last June, but far from the target of 2 percent.
The committee will closely monitor the information received and assess the implications for monetary policy during the coming period, according to the Fed’s statement.