Fed raises interest rates for first time in three years

The Federal Reserve raised its benchmark interest rate Wednesday to a range of 3.75% to 4%, the first hike since July 2023, unanimously approved by all 12 voting members despite public pressure from President Trump to cut rates instead.

New Chair Kevin Warsh, in office only a few months, called inflation still too high and said the Fed would 'stay in our lane,' declining to address White House pressure directly. Analysts had openly worried the Fed's credibility was already compromised, with one investment note arguing only a hike could salvage the institution's reputation.

Trump, for his part, had recently posted online that the U.S. should have the lowest rates in the world and threatened to halt trade with deficit countries if rates weren't cut, which the Fed proceeded to ignore.

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