[Anchor]
A short while ago, the U.S. Federal Reserve raised its benchmark interest rate by 0.25 percentage points, returning to a rate-hike stance for the first time in 3 years and 2 months. Among the 19 FOMC members, 16 expected interest rates to be higher by the end of the year than they are now, and the possibility of another hike within the year is high.
For our first story today, September 17, New York Correspondent Kim Hyunwoo reports.
[Reporter]
The U.S. Federal Reserve raised its benchmark interest rate by 0.25 percentage points, as expected by the market.
Following today's meeting, the Fed announced that it unanimously decided to set the benchmark interest rate between 3.75% and 4%.
Having frozen interest rates for 5 consecutive times this year, the Fed pulled out the rate-hike card for the first time since Kevin Warsh took office as Fed Chair, and for the first time in about 3 years.
Chair Warsh explained the background behind the rate hike, stating that while the U.S. economic growth rate and unemployment rate are solid, inflation is the problem and stabilizing prices is the top priority.
[Kevin Warsh / U.S. Federal Reserve Chair: The plain fact is that inflation is too high, and it has remained that way for too long.]
The Fed also hinted that it could raise interest rates 1 more time this year.
Among the 19 Fed members, 18 disclosed their respective projections for the year-end interest rate, with the vast majority responding that rates need to be raised 1 more time.
Due to the U.S. rate hike, the interest rate gap with South Korea has widened to 1 percentage point.
New York stock indices, which had been on an upward trend prior to the Fed's announcement, turned downward after Chair Warsh repeatedly emphasized during his press conference that the inflation rate is high, ultimately resulting in all three major indices closing lower.
[Nicole Bashaw / Labor Economist: Businesses have no choice but to feel burdened because the interest rates they have to pay when securing additional funds or expanding their businesses are also rising.]
In addition, the yield on the 10-year U.S. Treasury note rose following the rate-hike announcement, surpassing 5% once again, a level considered a psychological resistance line.
(Photo: Yonhap News)
(Video Reported by Lee Hee-hoon | Video Edited by Kim Jin-won)
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