The Federal Reserve raised its target federal funds rate by a quarter percentage point from near zero at the end of its two-day meeting Wednesday.
The first increase in the benchmark rate in three years will lay the groundwork for six more hikes by year’s end.
“The war in Eastern Europe gives the Fed reason to act more cautiously, but they will still be working to corral what is already the highest inflation in 40 years,” said Greg McBride, chief financial analyst at Bankrate.com.
The federal funds rate, which is set by the central bank, is the interest rate at which banks borrow and lend to one another overnight. Although that’s not the rate that…