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United States: the Fed modestly raises its rate by a quarter of a percentage point

2023-03-22T18:23:01.862Z


The turmoil in the banking sector is "likely to weigh" on the economy, nevertheless warned the American central bank.


The American central bank (Fed) opted for a moderate increase in its rate on Wednesday, by a quarter of a percentage point, as expected, still concerned about inflation, and despite the turbulence in the banking sector, which risks

weigh

on the economy.

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The decision was taken unanimously.

The Fed's main policy rate is now in a range of 4.75 to 5.00%, the highest level since 2006, and the institution plans further hikes.

The Fed anticipates inflation this year a little higher than it forecast in December, at 3.6% against 3.5%, but GDP growth a little weaker, at 0.4% against 0.5 %.

However, the Fed warned on Wednesday, after its meeting, that the recent banking crisis was "

likely (...) to weigh on economic activity, hiring and inflation

", stressing that "

the magnitude of these effects is uncertain

.

The powerful institution, which raised its rate by a quarter of a percentage point on Wednesday, also reaffirmed in its press release that "

the American banking system is solid and resilient

", and that its monetary policy committee "

remains attentive to the risks of inflation

.

Source: lefigaro

All news articles on 2023-03-22

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