Several listed subsidiaries of the Adani empire, which spans coal, airports, cement and media, collapsed in early trade, with some losing as much as 20%
business1 day ago
The Federal Reserve on Wednesday raised interest rates by a quarter of a percentage point and signalled it may pause further increases, giving officials time to assess the fallout from recent bank failures, wait on the resolution of a political standoff over the U.S. debt ceiling, and monitor the course of inflation. The unanimous decision lifted the US central bank's benchmark overnight interest rate to the 5.00 per cent -5.25 per cent range, the Fed's tenth consecutive increase since March 2022.
But the accompanying policy statement dropped language saying that its rate-setting Federal Open Market Committee still "anticipates that some additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 per cent over time."
In its place the Fed inserted a more qualified statement, reminiscent of language used when it halted rate hikes in 2006, which says that "in determining the extent to which additional policy firming may be appropriate," officials will study how the economy, inflation and financial markets behave in the coming weeks and months.
The new language does not guarantee the Fed will hold rates steady at its next policy meeting in June, and the statement noted that "inflation remains elevated," and job gains are still "running at a robust pace."
But the Fed's policy rate is now roughly the same as it was on the eve of a destabilising financial crisis 16 years ago, and is at the level which a majority of Fed officials projected in March would in fact be "sufficiently restrictive" to return inflation to target. It is currently still more than twice that level.
Economic growth remains modest, but "recent developments are likely to result in tighter credit conditions for households and businesses and to weigh on economic activity, hiring and inflation," the Fed said.
Risks around the recent failures of several US banks and a debt limit standoff between Republicans in Congress and Democratic President Joe Biden have added to the Fed's sense of caution about trying to tighten financial conditions further.
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