Fed meeting live updates: Rate hike expected for the first time in three years

The Federal Reserve is set to raise its benchmark overnight funds rate by a quarter point, the first increase in three years, as traders price in better than 90% odds that the FOMC will vote to tighten. The move comes as the central bank confronts persistent inflation that has proven difficult to contain.

Wall Street has shifted its stance on the rate hike, with consensus now firmly expecting the Fed to begin its tightening cycle. The 25-basis-point increase will lift the federal funds rate from the near-zero levels maintained since the pandemic-era cuts in March 2020.

The decision marks a pivotal turn in monetary policy after an extended period of accommodation. The Fed has telegraphed for weeks that it would begin raising rates to combat inflation running well above its 2% target, but the market has only recently priced the action with near-certainty. The quarter-point increment represents a measured initial step, leaving the door open for more aggressive moves if price pressures persist.