The Fed just aggressively raised interest rates again


The Federal Reserve said Wednesday it will again be raising interest rates three-quarters of a percentage point, as the central bank continues its aggressive push to tackle sky-high inflation.
The 12-member Federal Open Market Committee unanimously approved the atypical hike, and also signaled in a post-meeting statement that "ongoing increases" are to be expected, The New York Times reports. Wednesday's bump will lift the federal-funds rate — or, "the rate at which commercial banks borrow and lend their excess reserves to each other overnight," per Investopedia — to a range between 2.25 percent and 2.5 percent, adds The Wall Street Journal.
The statement from officials also acknowledged certain signs of economic slowdown since June's meeting, when the first 75 basis-point increase was approved: "Recent indicators of spending and production have softened," the statement read, per the Journal. But "[n]onetheless, job gains have been robust in recent months," and prices have meanwhile continued to quickly rise, "reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures."
The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
The central bank has raised interest rates 4 times and a total of 225 basis points this year, "as it battles a 1980s-level breakout of inflation with 1980s-style monetary policy," Reuters writes. Investors are expecting at least a 0.5-percentage-point increase in September.
Though the bank hopes it can bring down prices without tipping the U.S. into a recession, an economic downturn is still possible.
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Brigid Kennedy worked at The Week from 2021 to 2023 as a staff writer, junior editor and then story editor, with an interest in U.S. politics, the economy and the music industry.
-
August 31 editorial cartoons
Cartoons Sunday’s political cartoons include FEMA's new scheme, Gavin Newsom's antics, and a clue in the Epstein files
-
Disarming Hezbollah: Lebanon's risky mission
Talking Point Iran-backed militia has brought 'nothing but war, division and misery', but rooting them out for good is a daunting and dangerous task
-
Woof! Britain's love affair with dogs
The Explainer The UK's canine population is booming. What does that mean for man's best friend?
-
New York court tosses Trump's $500M fraud fine
Speed Read A divided appeals court threw out a hefty penalty against President Trump for fraudulently inflating his wealth
-
Trump said to seek government stake in Intel
Speed Read The president and Intel CEO Lip-Bu Tan reportedly discussed the proposal at a recent meeting
-
US to take 15% cut of AI chip sales to China
Speed Read Nvidia and AMD will pay the Trump administration 15% of their revenue from selling artificial intelligence chips to China
-
NFL gets ESPN stake in deal with Disney
Speed Read The deal gives the NFL a 10% stake in Disney's ESPN sports empire and gives ESPN ownership of NFL Network
-
Samsung to make Tesla chips in $16.5B deal
Speed Read Tesla has signed a deal to get its next-generation chips from Samsung
-
FCC greenlights $8B Paramount-Skydance merger
Speed Read The Federal Communications Commission will allow Paramount to merge with the Hollywood studio Skydance
-
Tesla reports plummeting profits
Speed Read The company may soon face more problems with the expiration of federal electric vehicle tax credits
-
Trump's threats to fire Jerome Powell are unsettling the markets
Talking Points Expect a 'period of volatility' if he follows through