Federal Reserve’s 11th rate hike: Inflation battle continues

The Federal Reserve raised interest rates by 25 basis points Wednesday, lifting the key lending rate to a range of 5.25% to 5.5%—the highest level since 2001.

The hike marks the 11th increase since March 2022.

Despite a year of declining inflation, currently standing at 3% (down from over 9% in June of the previous year), the central banking system aims to cool the economy and stabilize prices.

In a press conference, Federal Reserve Chair Jerome Powell acknowledged that inflation had somewhat moderated since the previous year and might require some economic losses.

The Fed has scheduled three more meetings this year, with the next in September. Powell seeks to maintain inflation at 2% by slowing the economy through rate increases and weakening the labor market.

So
Another rate hike may be on the horizon in September if the Fed doesn’t like what it sees. Powell is looking at the job market, which needs to slow down.