Fed Hikes Rates as Inflation Remains Elevated

The US Federal Reserve raised interest rates on Wednesday by a quarter of a percentage point to the 3.75-4% range, as it seeks to control inflation.

This is the first policy shift under new Fed chief Kevin Warsh, who took office in late May and was expected to cut rates.

Warsh said that when it comes to lifting rates, 'inflation remains elevated. Today's policy action will support a timelier return to the committee's 2% goal.'

The Fed also flagged further increases in borrowing costs in coming months, with 16 of 18 policymakers anticipating at least one more quarter-percentage-point hike by the end of this year.