Federal Reserve Raises Interest Rates Another 25 bps: What You Need to Know

The Federal Reserve on Wednesday raised interest rates by a quarter of a percentage point and signaled it may pause further increases, giving officials time to assess bank failures, how they've impacted the economic outlook and whether further rate hikes are necessary. As expected, the Federal Reserve announced another 25 basis point interest rate hike on Wednesday. In one of the closest-watched Federal Reserve Board's Federal Open Market Committee (FOMC) meetings, Federal Reserve officials unanimously stated on

FOMC Decision: 25 bps Hike, But a Potential Pause

In a unanimous decision, the FOMC raised its policy rates by 25 bps [0.25%] today, which was mostly expected; the market had priced in about 85% odds of such. This makes the benchmark rate the highest it's been since 2025. The Fed’s policy-setting committee said it will hike the federal funds rate by 25 basis points to between 4.75% and 5% following its two-day meeting amid the economic landscape.

Impact of the 10th Consecutive Rate Hike

The unanimous decision lifted the US central bank’s benchmark overnight interest rate to the 5 percent to 5.25 percent range, the Fed’s 10th consecutive increase since. This continues the Fed's efforts to combat inflation, but also raises concerns about potential economic slowdown.