US Federal Reserve hikes interest rate by 25 basis points to check inflation

The US Federal Reserve has raised interest rates by 25 basis points to check inflation. The Fed is aiming to bring inflation under 2 per cent and for that it has resorted to the fastest rate hikes in history, with ten increases since March 2023.

Despite the repeated rate hikes, inflation has not come down sharply. In March, inflation



slowed to 5 per cent - which was still well above the Fed's target.

Fed, in the last meeting on March 22, hiked interest rates by 25 basis points and said that its rate-setting panel sought "to achieve maximum employment and inflation at the rate of 2 per cent over the longer run".