WASHINGTON — The Federal Reserve raised its key interest rate Wednesday for the 11th time in 17 months as part of its ongoing drive to curb inflation. But it provided little guidance about when — or whether — it might hike rates again.
Wednesday’s move raised the Fed’s benchmark short-term rate from roughly 5.1% to 5.3% — its highest level since 2001.
Coming on top of its previous hikes, the Fed’s latest action could lead to further increases in the costs of mortgages,auto loans, credit cards and business borrowing.
Speaking at a news conference, Fed Chair Jerome Powell was noncommittal about any expectations for future rate hikes. Since it began raising rates in March 2022, the Fed has often telegraphed its upcoming action. This time, though, Powell said the Fed’s policymakers may or may not raise rates again at their next meeting in September.
“It is certainly possible that we will raise rates again at the September meeting,” he said.
“And I would also say it’s possible that we would choose to hold steady at that meeting.”
Powell sent a mixed message about whether he thinks the Fed will eventually need to further raise rates or instead just keep the current level of rates in place for a prolonged period.
“It was about as clear as mud, and I think that was the point,” said Diane Swonk, chief economist at accounting giant KPMG. “They don’t want to declare victory too soon. They know inflation moves in fits and starts.”