US Federal Reserve raises interest rates by half a point, acknowledging that inflation is slowing

What does it mean that inflation has dropped in the United States?

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(CNN) --

The Federal Reserve approved a half-point interest rate hike on Wednesday, a smaller increase than in recent months and an acknowledgment that inflation is finally subsiding.

The increase marks a reversal for the Federal Reserve after a record year that included seven consecutive rate hikes as part of an aggressive campaign to try to bring down the highest inflation since the early 1980s.

• Inflation in the United States fell more than expected in November, what does it mean for the pocket of consumers?

Though less than the four consecutive three-quarter point hikes approved at previous Federal Reserve meetings, Wednesday's rate hike is still double the central bank's usual quarter point hike and will likely add to the pain. millions of American businesses and households by further raising the cost of borrowing.

Last month, Federal Reserve Chairman Jerome Powell had anticipated smaller rate hikes, saying: "The time to ease the pace of rate hikes may be at the December meeting."

This news is in development.

US Federal Reserve interest rates