The US Federal Reserve on Wednesday announced that it had lifted the policy rate, federal funds rate, by 75 bps to the range of 2.25-2.5%. This decision came in line with the market expectation.

In its policy statement, the Fed noted that it anticipates that ongoing increases in the policy rate will be appropriate.

Market reaction

With the immediate reaction, the dollar came under modest pressure and the US Dollar Index fell below 107.00. 

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Follow our live coverage of the Fed's policy announcements and the market reaction.

Key takeaways from policy statement via Reuters

"Recent indicators of spending and production have softened."

"Job gains have been robust, the unemployment rate has remained low."

"Inflation remains elevated, reflecting pandemic-related imbalances, higher food and energy prices, broader price pressures."

"Balance sheet reduction will accelerate in sept as planned, with monthly caps on runoff rising to $35 bln for MBS and $60 bln for treasuries."

"War in Ukraine creating additional upward pressure on inflation, weighing on global economic activity."

"Highly attentive to inflation risks."

"Strongly committed to returning inflation to 2% goal."

"Prepared to adjust policy as appropriate."

"Fed vote in favor of policy was unanimous."