US Federal Reserve Raises Interest Rate by 75 bps

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US Federal Reserve Raises Interest Rate by 75 bps
16 Jun 2022
min read

News Synopsis

The US Federal Reserve has announced an increase in interest rates. Interest rates have been increased by 0.75%, making it the biggest increase in interest rates by the US Federal Reserve in 28 years.

Currently, inflation in the US is at its highest level in four decades. It was recorded at 8.6% in the month of May. In such a situation, the central bank of America has taken this step to control inflation. The 0.75% increase in interest rates has been the highest since 1994. 

Due to the increase in the interest rates of the US Fed, there is a cloud of the crisis on the Indian currency. An increase in interest rates will strengthen the dollar, but it may further depreciate the value of the rupee. The rupee is already at its lowest level against the dollar. On Wednesday, the rupee fell by 18 paise against the US currency at an all-time low of 78.22 per dollar in the forex exchange market. 

This decline has come due to the disappointing business in the domestic stock markets and the business sentiments of the investors being affected due to the continuous withdrawal of foreign capital disappointing business and foreign capital.

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