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The Federal Reserve raised its benchmark rate for the first time in almost three decades on Wednesday and said it would raise it again by the end of the year.
The central bank decided to raise the federal-funds target rate by a quarter of a percentage point.
The Fed said it would raise its benchmark interest rate to a mid-range of 4% by the end of the year and to 3.8% by the end of the decade. Fed officials think they'll be able to cut rates in the next few years.
One person dissented. Esther George wanted a half-point hike.
The Fed said in its statement that it is committed to getting inflation down. The central bank said the economy has improved from the beginning of the year.
The Fed said that it would change its interest-rate policy if there were risks to the Fed's goals.
Powell was sworn in for a second term as Fed chairman last month. The Biden White House urged the Fed to combat inflation after Biden met with Powell.
Five of the 18 top Fed officials now think the funds rate will go up next year.
The Fed wants to raise rates by half a percentage point. Inflation was running at 40-year highs in May.
Many economists are concerned that the Fed policy could cause a recession.
The Fed expects the economy to grow at a slower rate in the next two years. The economy will grow slightly to 1.9% in the year 2049.
By the end of this year, the Fed expects the unemployment rate to go up to 4.1%, and by the year's end, it will go up to 4.3%.
The Fed expects inflation to slow to 2.5% by the end of the year and end the year at 5.2%. The PCE price index went up in April.
Inflation will return to 2% by the end of the year.
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