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Federal Reserve raises benchmark interest rate

by Andrea Waitrovich

The Federal Reserve raised interest rates on Wednesday for the second time in three months.

The central bank voted to raise its key rate target to a range of 1 percent to 1.25 percent.

It also marked the fourth time the Fed has raised interest rates since December of 2015 when it deemed the economy finally healthy enough to withstand an interest rate higher than near-zero. The Fed has kept its key interest rate at unprecedented low levels for years in an effort to help the economy recover from the Great Recession.

The Fed gave a clear outline on its plan to reduce its $4.2 trillion portfolio of Treasury bonds and mortgage-backed securities, most of which were purchased in the wake of the 2007–2009 financial crisis and recession.

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