Kathmandu. The interest rate in the United States has been raised for the first time in more than 3 years. This step has been taken to curb rising inflation and it can be increased further, according to the Federal Reserve.
In a unanimous decision, the Federal Reserve raised interest rates between 3.75% and 4%. Previously, they were between 3.5% and 3.75%.
This decision was taken despite strong opposition from President Donald Trump. He had demanded a rate cut.
According to Federal Reserve Chairman Kevin Wars, the move was taken on the grounds that “inflation is very high and has persisted for a long time”. He called it a “serious” and “responsible decision”.
However, Trump said the interest rate should be “1% or less” because we have the best credit in the world, no competition. ’
Rising interest rates make loans, home loans, and credit cards expensive. However, it can give good returns on savings.
At a news conference after Wednesday’s decision, Wars said there was “an atmosphere of optimism” at the Federal Reserve, but inflation remains a problem.
Like many central banks, the Fed aims to keep inflation at or below 2%. Wars noted that inflation in the United States has been above this threshold for more than 5 years. This situation has made rising commodity prices and affordability a major concern for American voters.
Since the start of the US-Israel war with Iran, the price of fuel has also increased due to the sharp increase in the price of wholesale oil. As a result, the cost of many goods and services has increased. – Agency
