Today the U.S. Federal Reserve announced that it was bringing interest rates to the 4.50% to 4.75% range, a 0.25% increase from last month. Rates were still at 0% less than a year ago.
Rates Between 4.50% to 4.75%
The Federal Reserve is hiking interest rates by 25 basis points.
The U.S. central bank announced today during the Federal Open Market Committee that it would be raising federal interest rates by a mere 0.25%, bringing them to a range of 4.50% to 4.75%.
The rate increase was widely anticipated by markets, with analysts pricing the odds of a 25 basis points hike at 98%, and the odds of a 50 basis points hike at 2%. Neither major indices nor the crypto market reacted strongly to the announcement, with BTC only rising 0.07% immediately after the news.
This marks the eighth time the Fed has raised interest rates since the beginning of 2022. The central bank outlined its plan to tighten monetary conditions in November 2021 to fight raging inflation; back then, interest rates were at 0%. After being criticized for not taking inflation fears seriously, the Fed quickly moved to raise rates on a monthly basis—first by 25 points, then 50 points, then 75 points on multiple occasions. By doing so, the bank raised the cost of borrowing, which in turn strengthened the value of the dollar.
However, the Fed’s hawkishness was criticized by a number of entities, including the United Nations, which warned in October that the central bank risked causing a global recession by raising rates too quickly. The Fed finally began cooling down the aggressivity of its hikes last month, when it raised rates by 50 basis points instead of 75. Today’s decision is another step in that direction.
Original article: https://cryptobriefing.com/federal-reserve-raises-rates-by-25-basis-points/
