The Federal Reserve raised interest rates by a quarter percentage point on Wednesday, marking the 10th consecutive move in an aggressive hiking campaign that began a year ago to cool inflation.
Why it matters: As the banking system shows renewed signs of stress, the central bank gave its strongest signal yet that it could pause its series of rate increases.
Driving the news: In a policy statement, which is parsed by economists and traders, the Fed said it would monitor economic and financial data to assess “the extent to which additional policy firming may be appropriate.”
Stock prices began to decline and interest rates rose Wednesday afternoon, shortly after Fed chair Jerome Powell during a news conference reiterated the central bank’s focus on returning inflation to its 2% target.
“We are prepared to do more,” Powell said.
“A decision on a pause was not made today,” Powell said.
Between the lines: Wednesday’s policy statement came as a small, but notable change from the last one in March, when the Fed said it would monitor developments to determine the “the extent of future increases” in its target range.
The Fed also removed a line from its latest statement that said “additional policy firming may be appropriate.”
