Fed Raises Interest Rates by 0.50%

Largest move since 2000

 

 

Fed raises interest rates by 0.50%, largest move since 2000

 

Fed raises interest rates by 0.50%, largest move since 2000 Fed raises rates by 50 basis points, will begin shrinking balance sheet June 1. The Federal Reserve on Wednesday raised short-term interest rates by 0.50%, as part of an effort to tamp down the inflationary pressures weighing on Americans. The central bank suggested that it will further raise borrowing costs throughout this year as it attempts to undo its pandemic-era, easy money policies. The Fed is now targeting interest rates in a range between 0.75% and 1.00%, with some Fed officials advocating for raising the target closer to 2.5% by the end of the year. Balance sheet update. The Fed also officially unveiled a strategy to shrink its asset holdings, after buying trillions of dollars in U.S. Treasuries and agency mortgage-backed securities to contain COVID’s impact on financial markets.