As was widely expected, the Federal Reserve decided to raise the federal funds target rate by a quarter percent.
"Output appears to be growing at a moderate pace despite the rise in energy prices, and labor market conditions continue to improve gradually," the government said in its announcement today. "Inflation and longer-term inflation expectations remain well contained."
The increase brings the fed funds target to 2.5%.
MarketWatch reported the quarter point bump was widely expected.
Concurrent with the increase in the fed funds target, the discount rate was raised 25 BPS to 3.5%.
"The Committee believes that, even after this action, the stance of monetary policy remains accommodative and, coupled with robust underlying growth in productivity, is providing ongoing support to economic activity."