Federal Reserve Raises Rates to 3.75%-4% in Unanimous Vote

The Federal Open Market Committee voted 12-0 to raise the federal funds target range by 0.25 percentage point to 3.75%-4.00%. The committee said economic activity was expanding at a solid pace and inflation remained elevated, adding that the move would support a timelier return to its 2% goal. An implementation note set interest on reserve balances at 3.90% and the primary credit rate at 4.0%, effective September 17. September projections put median 2026 GDP growth at 2.3%, unemployment at 4.1% and PCE inflation at 3.7%.