Fed Chairman Jerome Powell (Photo:Reuters )

American interest rates now stand at 3.75% to 4%, the highest number since the 2008 financial crisis. The increase is part of efforts by the US central bank to control inflation, which is already at 8%, the highest point in the past 40 years. However, this will likely slow down US economic growth and increase financial hardship for US households and businesses. 

Fed Chairman Jerome Powell said: “My colleagues and I are strongly committed to bringing inflation back down to our 2% goal. We have both the tools that we need and the resolve it will take to restore price stability on behalf of American families and businesses. Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy. Today the policy interest rate is raised by 0.75 percentage points, and we anticipate that ongoing increases will be appropriate.”  

The US stock market experienced a rough session Wednesday with all three major US stock indexes losing points. The Dow Jones fell more than 500 points, the S&P 500 lost 96,41 points, and the Nasdaq Composite was 3.36% lower.

In a press conference following the Fed’s decision, Powell said it is too early to predict when the Fed will stop raising rates, but he left open the possibility that the Fed's meeting in December will consider an interest rate increase in line with the situation, and insisted it will take time to evaluate the effectiveness of this measure. Powell said the policy of raising interest rates will continue until the target of controlling inflation is achieved.