The Fed raises rates by half a percentage point

The US central bank on Wednesday raised its key rates by half a percentage point, the first increase of this magnitude since 2000, in an attempt to control record inflation. The Fed signaled that further hikes ‘would be warranted’ in the future.

Key rates are now in a range of 0.75% and 1%, according to a statement. In addition, the Federal Reserve will begin to reduce its balance sheet as of June 1, another monetary tightening tool to temper inflationary pressure.

Finally, the institution warns that the war in Ukraine and the confinements in China will aggravate inflation and logistical problems.

/ATS

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