US Fed slows pace of rate hikes as inflation eases

US Fed slows pace of rate hikes as inflation eases

After four straight three-quarter-point interest rate hikes, the US Federal Reserve on Wednesday raised interest rates by half a percentage point (50 bps) at its final gathering of the year.

The Fed's move is seen as step down in its efforts to fight inflation. Smaller increases in interest rates are expected to be followed internationally.

"The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run. In support of these goals, the Committee decided to raise the target range for the federal funds rate to 4-1/4 to 4-1/2 percent," the FOMC said in a statement.

"The committee anticipates that ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2% over time," it said.

Interest rate hikes led to costly borrowing rates for consumers as well as corporates, especially when it came to availing personal loans, mortgages, auto and business loans.

However, November's inflation data showed consumer prices rising less than expected for a second straight month.

The Fed has now implemented a total of seven rate increases in a row to tame inflation.

UAE, GCC central banks match rate hike

In the GCC, the