Fed Raises Benchmark Interest Rate by 0.25 Percentage Points Amid Inflation Pressure... Signals Potential Further Hikes

[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. With 16 out of 19 FOMC members expecting interest rates at the end of the year to be higher than they are now, the possibility of another hike within this year is high.

Reporting from New York, this is correspondent Kim Hyunwoo.

[Reporter]

As widely expected by the market, the U.S. Federal Reserve raised its benchmark interest rate by 0.25 percentage points.

Following its meeting today (September 17), the Fed announced that it has 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 has pulled out a rate hike card for the first time since the inauguration of Fed Chair Kevin Warsh and in about 3 years.

Chair Warsh explained that while the U.S. economic growth rate and unemployment rate remain solid, inflation is the problem, emphasizing that price stability is the top priority as the background for the rate hike.

[Kevin Warsh / Chair, U.S. Federal Reserve: "The clear fact is that inflation is too high, and that condition has persisted for too long."]

The Fed also hinted that it could raise interest rates 1 more time within this year.

Among the 19 Fed members, 18 disclosed their respective expected interest rate levels for the end of this year, and the vast majority of them responded that interest 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.

President Trump, who has consistently pressured for lower interest rates, took to social media to criticize the decision made by Fed Chair Kevin Warsh, whom he appointed, stating that interest rates should be lowered promptly.

New York stock indices, which had been on an upward trend until the Fed's announcement, turned downward after Chair Warsh repeatedly emphasized high inflation rates during his press conference, ultimately closing lower across all three major indices.

[Nicole Bachaud / Labor Economist: "Businesses have no choice but to feel the burden, because the interest rates they have to bear when raising additional funds or expanding their businesses are also rising together."]

In addition, the yield on the 10-year U.S. Treasury note rose following the rate hike announcement, once again surpassing the psychologically significant resistance level of 5%.

(Camera reporting: Lee Hee-hoon, Video editing: Kim Jin-won)
※ Please note: This article was translated by AI and may contain errors.