Meeting market expectations, the Fed unexpectedly raised rates by 0.3%, causing stock market volatility but ultimately closing in the green, with cryptocurrencies also rising across the board.

The Federal Reserve (Fed) concluded its two-day Federal Open Market Committee (FOMC) meeting on Wednesday the 15th, raising interest rates by 75 basis points in one go, the largest increase since 1994. Apart from Kansas City Fed President Esther George, who supported a 2-point increase, all other FOMC voting members agreed on a 3-point hike.

Following market expectations, the U.S. stock market fluctuated higher after the interest rate hike news was released, with the Dow closing up 303.70 points, or 1%, at 30,668.53 points. The S&P ended a five-day losing streak, rising 54.51 points, or 1.46%, to close at 3,789.99 points. The Nasdaq rose 270.81 points, or 2.5%, to 11,099.16 points, and the Russell 2000 index climbed 47.7 points, or 1.77%, to 2,737.5 points.

Bitcoin and Ethereum also rebounded, reaching $22,400 and $1,220 respectively.

The Federal Reserve stated in its announcement that employment growth has been robust in recent months, with low unemployment rates, but inflation remains high due in part to the humanitarian and economic hardships brought about by Russia's aggression in Ukraine, as well as potential disruptions in the supply chain due to China's containment measures. The FOMC committee aims to achieve full employment and to bring the long-term inflation rate to 2%, hence the decision to raise the federal funds rate target range to 1.50% to 1.75%, and expects further adjustments to be appropriate.

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