The Federal Reserve has taken a significant step in its effort to combat surging inflation by raising its target rate by 0.25 percentage point, bringing it to the highest level in 22 years.
In the recent announcement by the policy-setting Federal Open Market Committee, the overnight federal funds rate has been adjusted to a range of 5.25% to 5.5%. Despite indications of a moderation in inflation, the Fed remains focused on addressing the persistently high price levels.
According to the Committee’s statement, recent economic indicators suggest that there has been a moderate expansion in economic activity.