The Federal Reserve on Wednesday approved its first interest rate hike in more than three years and indicated another to come, as part of an effort aimed at combating inflation brought on by spiraling oil prices and other factors.
In a move that markets widely anticipated, the central bank’s Federal Open Market Committee voted 12-0 to increase its key interest rate by a quarter percentage point, or 25 basis points. The move brought the overnight funds rate to a target range of 3.75%-4%.
Despite a raft of conflicting recent statements from policymakers, markets had priced in a better than 90% chance that the FOMC would approve the increase, though there was chatter about the possibility of multiple dissents.