The U.S. Federal Reserve raised interest rates by 25 basis points Wednesday, delivering its first hike in three years as persistent inflation outweighed President Donald Trump’s repeated calls for lower borrowing costs.
The move lifted the Fed’s benchmark rate as policymakers sought to curb renewed price pressures despite political pressure for monetary easing.
The central bank also signaled that another rate increase could follow before the end of the year, underscoring concerns that inflation remains too high to justify a shift toward looser policy.
The decision marks a sharp turn in the U.S. monetary policy outlook after the Fed had previously moved toward lower rates. Recent inflation readings and resilient economic activity had strengthened expectations that policymakers would resume tightening.
Trump has repeatedly pressed the Fed to cut interest rates, arguing that lower borrowing costs would support economic growth. The rate increase instead highlights the central bank’s focus on bringing inflation under control.
