The US Federal Reserve has elected to raise the target for the federal fund rate yet again. The Fed raised the target range to 5 to 5 1/4 percent, representing a 25 bps hike, following a unanimous decision by the committee.
“The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. In support of these goals, the Committee decided to raise the target range for the federal funds rate to 5 to 5-1/4 percent,” the committee said within its statement.
The committee also acknowledged that it will continue to reduce its holdings in Treasuries, agency debt, and agency mortgage-backed securities as it has previously announced. Notably, the fed also omitted prior language that signaled further hikes again, suggesting that it will be taking a pause in raising rates.
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Finally, the committee also warned of tighter credit conditions for both households and businesses, which is expected to weight on economic activity, hiring, and inflation.
Information for this briefing was found via The Federal Reserve and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
