US Federal Reserve Raises Interest Rates for First Time in Three Years

On Wednesday, the Federal Open Market Committee (FOMC) voted unanimously to raise the target range for the federal funds rate by 25 basis points to 3.75–4.0%. The Committee said it is continuing its policy of maintaining ample reserves in the banking system.

In its statement, the FOMC said:

“Economic activity is expanding at a solid pace. While uncertainty remains elevated owing, in part, to geopolitical developments, domestic spending has been resilient. Productivity growth is strong, and capital investment is robust. Job gains have kept pace with the workforce, and the unemployment rate has changed little.

Inflation remains elevated. Today’s policy action will support a timelier return to the Committee’s 2% goal. The Committee will deliver price stability.”