Federal Reserve raises interest rates to tame rising inflation, Dow falls 320+ points
As anticipated, the Federal Reserve increased its key short-term interest rate by 25 basis point on Wednesday.
WASHINGTON, US (TechtUSA) - The Federal Reserve increased interest rates by 25 basis point in its first meeting of 2023, indicating that they are seeing success in controlling inflation. This move marks a shift towards a more conventional interest rate policy and follows months of large rate increases aimed at slowing down the economy. The decision was made unanimously by the Federal Open Market Committee.
Inflation is under control, but "remains elevated"
Fed stated that “Inflation has eased somewhat but remains elevated,” Federal Reserve stated that continued interest rate increases will be necessary to achieve its target of 2% inflation. While some economists expected the Fed to mention "further increases", this suggests that the interest rate hike cycle may be near its end.
The current Fed interest rate
The Federal Reserve's recent action has raised the federal funds rate to a range of 4.5% to 4.75%. This is the largest series of interest rate increases since the 1980s, having gone up from close to zero in March.
Dow has fallen more than 320 points after Fed announcement
The Dow Jones Industrial Average dropped by 327 points, equivalent to a 1% decrease. The S&P 500 declined by 0.4%, while the Nasdaq Composite remained relatively unchanged, with an increase in chip companies due to favorable earnings from Advanced Micro Devices (AMD).
Bitcoin and Ethereum technical analysis before FEDMoney
