The U.S. Federal Reserve raised its benchmark interest rate to a target rate range of between 0.75% and 1%pa on Wednesday,
Despite a surprise slowdown in economic activity rippling through from Ukraine, inflation was a 41 year high of 8.5%pa in March.
This prompted the Fed to act with its first double rate high of 2 X 0.25%pa since 2000.
Usually, central banks move interest rates upwards and downwards by no more than 0.25%pa. Smoothly transitioning upwards or downwards prevents economic shock.
This double hike was a surprise. In addition, the Fed also suggested that this will not be the first double hike for 2022 if inflation remains high.