The Federal Reserve raises the key interest rate again to 4.75% and signals that more will come

The move was widely expected, but unlike the Bank of Canada, the US central bank is hinting at more rate hikes on the way.

According to cbc : Jerome Powell, chairman of the US Federal Reserve, will explain the central bank's line of thinking at a news conference on Wednesday.

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Inflation has decreased somewhat

The US central bank raised its target interest rate by a quarter of a percentage point on Wednesday and promised "continued increases" in borrowing costs as part of its battle against inflation.

"Inflation has eased a bit, but it remains elevated," the Federal Reserve said in a statement that marked explicit acknowledgment of progress in slowing the pace of price increases from 40-year highs reached last year.

Russia's war in Ukraine

Russia's war in Ukraine, for example, was still seen as adding to "elevated global uncertainty," the Fed said. But policymakers have abandoned the language of earlier statements citing the war and the COVID-19 pandemic. as direct contributors to rising prices.

modest growth

Still, the Fed said the US economy was enjoying "modest growth" and "solid" job growth, and policymakers remained "very vigilant about inflation risks."

Personal Real Estate Corporation ALEX SHAH

The move was widely expected, but unlike the Bank of Canada, the US central bank is hinting at more rate hikes on the way.

Key interest rates in the U.S. and Canada

"The (Federal Open Market) Committee anticipates that continued increases in the target range will be appropriate to achieve a monetary policy stance that is tight enough to return inflation to 2 percent over time," the Fed said.

But in following through on the promise of more rate hikes to come, the Fed dismissed investor expectations that it was ready to mark the end of the current tightening cycle as a nod to the fact that inflation has been steadily declining for six months. .

It's also a departure from the outlook the Bank of Canada gave last week, when Canada's central bank raised its rate to 4.5 percent, but signaled it could be content to keep its rate there.