Federal Reserve officials made their eighth interest rate increase in a year on Wednesday, a quarter-point move, as they continued their fight against rapid inflation.

 

Jeanna Smialek

Isabella Simonetti

Updated

Feb. 1, 2023, 2:21 p.m. ET10 minutes ago

10 minutes ago

Jeanna Smialek and Isabella Simonetti

https://www.nytimes.com/live/2023/02/01/business/fed-interest-rates-inflation

 

Federal Reserve officials made their eighth interest rate increase in a year on Wednesday, a quarter-point move, as they continued their fight against rapid inflation. And while policymakers slowed the pace of adjustment to give themselves more time to see how their policies are affecting the economy, they signaled further rate moves to come.

 

The central bank concluded its first meeting of 2023 by announcing the smallest adjustment since March. The Fed last year lifted borrowing costs at the fastest pace since the 1980s as officials tried to cool the economy and drive inflation lower by slowing consumer and business demand.

 

The Fed’s policy rate is now set to a target range of 4.5 to 4.75 percent, as expected, up from near-zero at this time last year.

 

“Inflation has eased somewhat but remains elevated,” officials said in their statement announcing the rate decision, while reiterating that “ongoing increases in the target range will be appropriate.”

 

Markets continued trading lower after the decision. Some investors and analysts had expected that the “ongoing increases” phrase might be dropped from the post-meeting statement, which would suggest that Wednesday’s increase might be the last. It wasn’t.

 

The Fed omitted a line in previous statements expressing concern that war in Ukraine was a drag on global growth, but noted that the war was contributing to “elevated global uncertainty.”