Fed announces 50 point rate hike
The Fed announced it will raise interest rates by 50 basis points, marking an end to the pattern of 75 point hikes seen in recent months.
Before this move, the Fed had raised rates by 75 basis points at the last four meetings. A basis point is equivalent to 0.01%.
The 50 basis point hike was widely expected ahead of the meeting.
It’s the final policy decision expected from the central bank in 2022.
— Alex Harring
Powell wants ‘substantially more evidence’ that inflation is cooling
Federal Reserve Chairman Jerome Powell said Wednesday the recent positive signs for inflation aren’t enough for the central bank to ease back on interest rate increases.
“It will take substantially more evidence to have confidence that inflation is on a sustained downward” path, Powell said during his post-meeting news conference.
The comments came as the Fed raised its benchmark rate another half percentage point and indicated at least another three-quarters of a point in hikes are coming. The decision also occurs a day after November’s consumer price index reading was up just 0.1%, an indication that inflation may have peaked.
However, Powell said inflation remains a problem.
“Price pressures remain evident across a broad range of goods and services,” Powell added.