WORLD

Here’s what you need to know about the Fed’s rate hike

A screen displays the Fed rate announcement as traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., March 16, 2022. REUTERS/Brendan McDermid

After a good few months of um-ing and ah-ing about what to do about the record-high levels of inflation, the Fed has voted on Wednesday 8-1 in favor of raising interest rates on government loans by about a quarter percent. This is after two years of near-zero rates aimed to protect the economy during the pandemic.

Key comments:

“The American economy is very strong and well-positioned to handle tighter monetary policy,” said Fed Chair Jerome Powell after the vote. “I saw a committee that is acutely aware of the need to return the economy to price stability.”

“This is going to be a pretty aggressive tightening cycle. I don’t know if the Fed is going to pull off a soft landing,” said Ryan Sweet, the guy in charge of monetary policy research at Moody’s Analytics. “It’s very clear the Fed is more than doubling down on addressing inflation.”

You drive the stories at TMS. DM us which headline you want us to explain, or email us.