US Federal Reserve says inflation remains high, rate hike to support targets

The US Federal Reserve explained the reasons behind its decision to raise interest rates.

It added that inflation remains elevated and that the rate hike will help support targeted levels, according to Al Arabiya.

The Federal Reserve raised its key interest rate by 25 basis points, marking the first increase since 2023, in response to ongoing inflationary pressures and rising energy prices.

The move follows a prolonged period during which the Fed had either cut or held rates steady, as markets anticipated a shift in monetary policy amid growing concerns over persistent inflation.