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Stock photo: Jerome Powell

The Federal Reserve delivered the biggest interest-rate increase since 2000 and signaled it will keep hiking at that pace over the next couple of meetings, unleashing the most aggressive policy action in decades to combat soaring inflation.

The U.S. central bank’s policy-setting Federal Open Market Committee (FOMC) on Wednesday voted unanimously to increase the benchmark rate by a half percentage point. It will also begin allowing its holdings of Treasuries and mortgage-backed securities to decline in June at an initial combined monthly pace of $47.5 billion, stepping up over three months to $95 billion.

“Inflation is much too high, and we understand the hardship it is causing, and we are moving expeditiously to bring it back down,” Chair Jerome Powell said in his first in-person press conference since the pandemic began. He added that there was “a broad sense on the committee that additional 50 basis point [bps] increases should be on the table for the next couple of meetings.”

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