The United States Federal Reserve hiked the key interest rates by 75 basis points on Wednesday, November 2, 2022, to control surging inflation and hinted at a slower pace in the future. The Fed raised its rate by 0.75 percentage points to a range of 3.75% to 4% by a unanimous vote.

The Fed officials said that “ongoing increases” will likely be needed to bring rates to a level that is “sufficiently restrictive to return inflation to 2% over time,” according to the Federal Open Market Committee’s statement following a two-day meeting.

Also Read | US Federal Reserve hikes interest rates by 75 basis points

US Stock Markets

Stocks tumbled after Fed Chair Jerome Powell said inflation was still too high and signaled that the central bank has more rate hiking ahead. The Dow Jones Industrial Average slumped 505.44 points or 1.55% to settle at 32,147.76. The S&P 500 plunged 2.5% to close at 3,759.69. The Nasdaq Composite dropped 3.36% to settle at 10,524.80.

Also Read | ECB announces super rate hike of 75 bps to combat inflation

Treasury Yields

Treasury yields jumped after a brief pullback. The yield on the two-year Treasury, which often tracks market expectations of future Fed action, rose to 4.61% from 4.55% shortly before the Fed released its statement. The yield on 10-year Treasury, which helps determine rates, jumped to 4.09% after having fallen to 3.98% earlier in the afternoon.

Also Read | Bank of Japan keeps ultra-low interest rates at -0.1%


The dollar gained some strength after Powell said it was premature to discuss a pause in hiking interest rates to fight soaring inflation, as there is “no sense that inflation is coming down.” The US dollar index (DXY) rose 0.58% to 112.13. The euro initially rose against the dollar but later turned lower, down 0.5% at $0.9825. The Japanese Yen surged 0.31% against the greenback at 147.79 per dollar. 

Also Read | RBI to hold additional meeting of Monetary Policy Committee on November 3

Oil prices

Oil prices gained ground even as other risk assets declined after the Fed’s fourth interest rate hike of the year. Brent crude, the international oil benchmark, rose $1.51 or 1.6% to $96.16. The US West Texas Intermediate (WTI) crude surged $1.63 or 1.8% to $90. 

Gold prices

Gold prices slipped after the Fed policy decision. Spit Gold fell 0.5% to $1,640.05 per ounce by 3:45 pm EDT. The US gold futures settled 12 points or 0.73% at $1,637.70. 

Also Read | UK votes to recognize crypto as regulated financial instrument


The Fed rate hike did not have much effect on the wider crypto market, suggesting that it had already been priced in. The price of Bitcoin was sitting around $20,175.10 in late afternoon trading, down about 1.5% over the past 24 hours. The largest cryptocurrency in the world looked vulnerable to a drop below the $20,000 level and back into the $19,000 to $20,000 range where it has stagnated for much of the past two months.