Fed raises interest rate by 0.75 per cent to tackle rising inflation

WASHINGTON, July 27 (KUNA) -- The US Federal Reserve on Wednesday raised the interest rate by 0.75 per cent to a range between 2.25 and 2.50 per cent in a move aimed at combatting an "upward pressure on inflation." "Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures," the Fed said in a statement after a committee meeting.
"Recent indicators of spending and production have softened. Nonetheless, job gains have been robust in recent months, and the unemployment rate has remained low," it added.
Russia's military operation in Ukraine is another factor weighing heavy on inflation, the Fed said, adding it was determined to return inflation and employment to their previous 2 per cent rates.
It also expects that "ongoing increases in the target range will be appropriate." "In addition, the (Fed) Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities, as described in the Plans for Reducing the Size of the Federal Reserve's Balance Sheet that were issued in May," it added. (end) rsr.sd