Fed Announces Biggest Rate Hike Since 1994



The Federal Reserve, fighting to tame inflation, is raising its key interest rate by three-quarters of a point—triple the usual amount, and the biggest hike since 1994. Fed Chairman Jerome Powell dismissed the idea of a rate hike this size last month, saying it was “not something the committee is actively considering,” but data released since then shows that inflation has soared to a four-decade high, CNBC reports.

The move will increase the Fed’s benchmark rate to a range between 1.5% and 1.75%, and the Fed has signaled that it plans to keep raising rates this year, reports the Wall Street Journal. Stocks rose ahead of the announcement Wednesday, with the S&P 500 up 1% and the Nasdaq up nearly 2%, but they gave up some of their gains when the decision was released, the AP reports. (Read more Federal Reserve stories.)

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