Fed raises rates to 5%

The Federal Open Market Committee decided Wednesday 10 May to raise its target for the federal funds rate by 25 basis points to 5 percent. In its statement the FOMC said "some further policy firming may yet be needed."

Economic growth has been quite strong so far this year. The Committee sees growth as likely to moderate to a more sustainable pace, partly reflecting a gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices.

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