1) Fed increases interest rate by 0.25ppt
The Federal Reserve raised the target for the fed funds rate by 0.25 percentage point to 0.25%-0.5%, marking its first rate hike since 2018, especially after a series of cuts in 2020 during to Covid-19 outbreak.
As for the plan to reduce its holdings of Treasury securities and agency debt and agency mortgage-backed securities, policymakers pointed out that it will begin at an upcoming meeting, which will be on May 3-4, 2022.
The Fed now sees six more rate hikes at each of the remaining meetings this year, expecting the fed funds rate to reach 1.9% by year’s end.
The personal consumption expenditure inflation is seen sharply higher at 4.3% in 2022, compared to 2.6% in the December projection. Meanwhile, the U.S. economic growth is seen to expand 2.8% this year, a sharp drop from a 4% seen in December.
2) US stocks closed higher on Fed’s rate hike
Wall Street closed higher after the Fed announced a rate hike by 0.25 percentage point, which was in line with the market estimation.
Dow Jones closed 1.55% higher at 34,063.10 points, S&P 500 gained 2.24% and Nasdaq jumped 3.77%.
3) Boris Johnson says Ukraine will not join NATO anytime soon
The British Prime Minister Boris Johnson on Wednesday dimmed the hopes of Ukraine in joining the North Atlantic Treaty Organization (NATO), at least in the near future, saying that Kyiv will not become a member of the group anytime soon.
