The world this week--Business
The Federal Reserve raised its benchmark interest rate by another three-quarters of a percentage point, to a range of between 3% and 3.25%.
It was the third consecutive such increase and came after figures showed that inflationary pressures are moving extensively beyond food, energy and goods to services prices, such as rent.
The Fed now projects the rate to rise to at least 4.25% by the end of the year.
Jerome Powell, the central bank’s chairman, said “We have to get inflation behind us”, and that there was no painless way to do so.
Other central banks also tightened monetary policy at an aggressive pace to battle inflation.
The Bank of England lifted its benchmark rate by half a percentage point, to 2.25%, the highest it has been since 2008 (three members of the nine-person Monetary Policy Committee voted for a rise of three-quarters of a percentage point).
Swiss National Bank raised its key rate to 0.5% from -0.25%, ending seven years of negative rates.
Sweden’s Riksbank, a laggard compared with most of its contemporaries, lifted its main policy rate by one percentage point, to 1.75%, the biggest increase in three decades.
Bucking the trend the Bank of Japan maintained its ultralow rate.
That caused the yen to slide further against the dollar, prompting Japan to intervene in foreign-exchange markets to shore up the currency for the first time since 1998.
Before the intervention the yen had fallen by 20% against the dollar this year.
The German government nationalised Uniper, Germany’s biggest gas importer, to prevent it from collapsing.
Uniper had been forced to turn to the more expensive spot market when Russia curtailed its gas supplies, leading to huge losses.
The German government also took control of three refineries operated by Rosneft, Russia’s biggest oil company, to secure Germany’s energy supply ahead of an EU embargo on Russian oil.
In Britain the government introduced a scheme that will cut energy bills for businesses by around half over the winter by capping the wholesale price of electricity and gas, an extension of the huge financial support it had earlier promised for households.
Many firms risk going bankrupt because of soaring energy costs.
Volkswagen announced that shares in Porsche will debut on the Frankfurt stock exchange on September 29th.
Only a small portion of the shares being offered by VW, Porsche’s owner, will be available to the public.
Still, the IPO could value Porsche at up to 75bn euros ($74bn).