The Federal Reserve raised interest rates by 0.75 percentage point on Wednesday during the July Federal Open Market Committee (FOMC) policy meeting.
The FOMC’s three-quarter-point hike lifted the benchmark fed funds rate to the range of 2.25–2.5 percent. It was a unanimous decision among central bank officials.
In addition, the Fed’s balance-sheet reduction efforts will continue, as expected, in September. The monthly run-off caps will rise to $35 billion for mortgage-backed securities and $60 billion for U.S. Treasurys.
While the labor market has remained strong, “recent indicators of spending and production have softened,” the FOMC said in a revised statement.
“Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures,” the rate-setting committee stated….