US Interest rates jump

However, it did not go to 100, which some people had thought was possible.

Its actions will raise the target range for the federal funds rate to 3% to 3.25%.

In a statement, the Fed referred to modest production growth and robust jobs growth as pushing prices upwards.

“Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures,” the statement said.

The statement went on to blame the war against Ukraine for creating additional upward pressure on inflation.

The Fed said it sought to achieve maximum employment and inflation at the rate of 2 percent over the longer run. The current inflation rate is 8.3% in the US.

The Fed added it would continue to monitor developments and said its assessments would take into account a range of impacts of monetary policy on public health and labour market conditions, as well as inflation and the wider economy.

High interest rates in the US usually entice investors to climb into that currency to get better returns. This usually raises the value of the US dollar and causes others to fall against it.

The New Zealand dollar is among them and fell to is US$ 0.5850, ahead of the news, before recovering by a fractional amount to US$ 0.58554 after the Fed statement emerged.