Washington is trying to fight inflation, which has been further pressured by Russia’s full-scale invasion of Ukraine.
For the first time since 1994, the US Federal Reserve immediately raised its base interest rate by 0.75% of the base point – to 1.5-1.75% per year. This is stated in a press release from the Fed, released on Wednesday, June 15.
“Russia’s invasion of Ukraine is causing enormous economic hardship. The invasion and related events have created additional pressure on inflation and affected global economic activity,” the Fed said.
Thus, according to the regulator’s forecast, by the end of the year the rate will increase to 3.4%, and by the end of 2023 its size will be 3.8%.
The Fed also lowered its forecast for US GDP growth for 2022 from 2.8% to 1.7%, for 2023 from 2.2% to 1.7%. The forecast for US inflation in 2022 has been raised from 4.3% to 5.2%.
The Fed has hinted that it will continue to raise rates this year at the fastest rate in decades in an effort to tackle inflation, which hit a 40-year high of 8.6% in April.
As reported, in May, the US Federal Reserve raised the base rate by 50 basis points – up to the range of 0.75-1% per year.
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Source: korrespondent
I am Dylan Hudson, a dedicated and experienced journalist in the news industry. I have been working for Buna Times, as an author since 2018. My expertise lies in covering sports sections of the website and providing readers with reliable information on current sporting events.