‘Inflation is too high and has been for too long,’ says Kevin Warsh as Fed announces rate hikes
Federal Reserve Chairman Kevin Warsh announced an interest rate hike, the first in three years, to address inflation he described as too high for too long. Warsh called the move a "serious" and "responsible" decision. US stocks dropped sharply following the announcement and signals that further hikes may follow. Prior to the decision, traders had estimated a better than 90% probability that the FOMC would raise the overnight funds rate by a quarter point.
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- ✓ Federal Reserve Chairman Kevin Warsh announced rate hikes to address inflation.
- ✓ This is the first time the Federal Reserve has hiked rates in three years.
- ✓ Kevin Warsh described the decision to raise rates as "serious" and "responsible".
- ✓ US stocks fell after the Federal Reserve raised rates and suggested more hikes could follow.
What changed
The Federal Reserve officially raised interest rates and signaled potential future increases.
Live updates
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Fed Hikes Rates for First Time in Three Years to Combat Persistent Inflation
Federal Reserve Chairman Kevin Warsh announced an interest rate hike, the first in three years, to address inflation he described as too high for too long. Warsh called the move a "serious" and "responsible" decision. US stocks dropped sharply following the announcement and signals that further hikes may follow. Prior to the decision, traders had estimated a better than 90% probability that the FOMC would raise the overnight funds rate by a quarter point.
Why it matters
The Federal Reserve uses interest rate adjustments to control inflation and stabilize the economy. A rate hike increases borrowing costs, which typically slows spending to lower price growth. This move ends a three-year period of stable or declining rates.
What is confirmed
- Federal Reserve Chairman Kevin Warsh announced rate hikes to address inflation.
- This is the first time the Federal Reserve has hiked rates in three years.
- Kevin Warsh described the decision to raise rates as "serious" and "responsible".
- US stocks fell after the Federal Reserve raised rates and suggested more hikes could follow.
Still unconfirmed
- Traders assigned a better than 90% probability that the FOMC would raise the overnight funds rate a quarter point.
What to watch next
- Official confirmation of the specific basis point increase in the FOMC statement
- Future Federal Reserve meeting dates for additional rate decisions
- Market reaction to the next inflation data release
confidence 95%Sources used for this update (10)
- CNBC — Stock futures are little changed ahead of pivotal Fed rate decision: Live updates
- PBS — WATCH LIVE: Warsh holds briefing after Fed meeting as interest rates expected to rise
- www.cnbc.com — The Federal Reserve is expected to hike rates for the first time in three years: Live updates
- The Guardian — ‘Inflation is too high and has been for too long,’ says Kevin Warsh as Fed announces rate hikes – live
- KATU — Fed move to raise rates was a 'serious' and 'responsible' decision: Warsh
- wsj.com — Fed Chairman Kevin Warsh’s Postmeeting Press Conference
- www.capitalbrief.com — US Fed hikes rates, signals more
- www.thehindubusinessline.com — Sensex today | Stock Market Highlights: Nifty, Sensex close flat as high crude price concerns offset value buying
- www.newser.com — Stocks Drop Sharply After Fed Chair's Remarks
- finance.yahoo.com — Interest rate increase ‘likely’, warns Bank of England
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