Federal Reserve Resumes Interest Rate Hikes

The central bank agreed to a 25 basis point increase in July after electing to not raise the federal funds rate in June.

  • Following a skip at its June meeting, the Federal Reserve (Fed) chose to raise the federal funds rate by 25 basis points (bps) at the July 2023 Federal Open Market Committee (FOMC) meeting.
  • The 25 bps increase lifts the federal funds rate to 5.25%-5.50%.
  • The Fed's cumulative total increase is now at 525 bps since March 2022, with a total of 100 bps of increases occurring in 2023.
  • Fed Chair Jerome Powell reaffirmed that the central bank is strongly committed to bringing inflation down to its 2% target.
  • Further tightening, if warranted, will be assessed on a meeting-by-meeting basis by the FOMC.