US Federal Reserve raises rates to 22-year-high as it continues fight against inflation

euronews (in English)

The latest quarter-percentage-point rise, which was in line with analysts' expectations, is the Fed's 11th since it began an aggressive campaign of monetary tightening last March in response to rising prices.

Transcript

00:00 The United States Federal Reserve has raised interest rates to a 22-year high

00:05 as it continues its fight against rising inflation.

00:08 The decision to increase rates by a quarter percentage point to a range of 5.25 to 5.5

00:14 percent comes after the Fed paused its rate-raising cycle last month.

00:20 It marks the 11th increase since early 2022, when the Fed started raising borrowing costs

00:27 to try to cool the economy and to ease rising prices.

00:31 Restoring price stability is essential to set the stage for achieving maximum employment

00:36 and stable prices over the longer run.

00:38 To conclude, we understand that our actions affect communities,

00:42 families and businesses across the country.

00:44 Everything we do is in service to our public mission.

00:48 We at the Fed will do everything we can to achieve our maximum employment

00:52 and price stability goals.

00:54 The US economy has remained robust despite the 11 rate rises the Fed has now implemented,

01:00 its most aggressive rate-raising cycle in 40 years.

01:04 Hiring has slowed but remained strong,

01:07 and the unemployment rate is still close to a record low.

01:10 The Fed's hike comes ahead of a similar meeting of the European Central Bank,

01:15 which is under pressure to signal an end to interest rate rises.

01:20 Eurozone banks have reported a sharp fall in demand for business loans

01:25 to its lowest level on record, likewise with home loan demand.

01:29 However, the ECB remains determined to bring inflation back down to its 2% target,

01:36 and that means a rate rise is still on the cards.

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