US Central Bank Hikes Benchmark Rate by 75 bps, Fed’s Largest Increase Since 1994

US Central Bank Hikes Benchmark Rate by 75 bps, Fed"s Largest Increase Since 1994

The U.S. Federal Reserve raised the federal funds rate by 75 basis points (bps) on Wednesday, and it was the largest increase since 1994. According to the Fed member’s expectations, the central bank will likely add another 1.5 percentage points by the year’s end. Fed Hikes Rate by 75 bps, Global Markets See Slight Rebound America’s central bank raised the interest rate by 75 bps on June 15, as it was the highest increase in decades. The last 75 bps rate hike took place during Alan Greenspan’s tenure, as the central bank’s former lead shocked the nation with the drastic increase. “Inflation remains well above our longer-run goal of 2% over the 12 months ending in April, total PCE prices rose 6.3%, excluding the volatile food and energy categories,” Jerome Powell, the U.S. central bank’s current chair said on Wednesday in a statement. The nineteen Fed officials believe the bank will end 2021 with a benchmark rate of 3.4%. This means the central bank will increase the rate by 1.5% over the next few months according to the Fed’s “dot plot.” The Federal Open Market Committee’s (FOMC) statementexplains that the U.S. economy looks positive but there’s still some uncertainty in the air. “Overall economic activity appears to have picked up after edging down in the first quarter,” the FOMC said. “Job gains have been robust in recent months, and the unemployment rate has remained low. Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher energy prices, and broader price pressures,” the Fed’s FOMC statement further explains. U.S. equities market jumped on the news and the major stock indexes erased some of the losses felt before the Fed announcement. However, the Dow Jone Industrial Average has been running sideways since the announcement. Bitcoin (BTC) remained unchanged after the announcement holding just above the $21K zone. The entire crypto economy at $982 billion did not flinch after the announcement as it seems the Fed announcement was priced into crypto and stock markets. An ounce of fine gold spiked in value, gold is up 1.22%, and an ounce of silver is up 2.84%. At the time of writing, an ounce of gold is valued at $1,830 per unit following the U.S. central bank’s announcement on Wednesday. Tags in this story 75 bps, Bitcoin, CPI, Crypto, Crypto markets, Dovish, economics, Economy, Fed, Fed Chair, Federal Reserve, FOMC, FOMC Meeting, gold, Hawkish, inflation, jerome powell, Markets, Markets Shudder, Moderate, PCE prices, silver, Stock Markets, stocks, US economy

What do you think about the Fed increasing the benchmark rate by 75 bps on Wednesday? Let us know what you think about this subject in the comments section below. Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today. JPMorgan Economist Expects the Fed to Hike Benchmark Rate by 75 bps as Global Markets Bleed ECONOMICS | 2 days ago Economist Peter Schiff Explains Why He Expects Bitcoin to Crash as Recession Deepens — Warns "Don"t Buy This Dip" ECONOMICS | 3 days ago

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