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Watch: Why has the Federal Reserve raised interest rates?

Watch: Why has the Federal Reserve raised interest rates?

Summary

The Federal Reserve has increased U.S. interest rates from 3.5%-3.75% to 3.75%-4%. This is the first rate hike in three years and is meant to help reduce inflation.

Key Facts

  • The Federal Reserve raised interest rates to between 3.75% and 4%.
  • The previous rate was between 3.5% and 3.75%.
  • This increase is the first since three years ago.
  • The goal of raising rates is to lower inflation, which means slowing down price increases.
  • Higher interest rates usually make borrowing money more expensive for people and businesses.
  • The Federal Reserve controls these rates to help manage the economy.
  • Inflation has been a concern that influenced this decision.
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