(Washington) The U.S. Central Bank on Wednesday raised its main interest rate for the tenth straight time since March 2022, by a quarter of a percentage point, determined to rein in inflation despite signs that the economy is faltering. and despite the recent banking crisis.

The Fed’s main policy rate is now in a range of 5.00-5.25%, the highest since 2006, a unanimous decision, the institution said in a statement released after the meeting of its monetary policy committee (FOMC).

Fed Chairman Jerome Powell will hold a press conference at 2:30 p.m.

Many market players are now waiting for a break in these rate hikes, which increase the cost of credit for households and businesses, and, by slowing down economic activity, should make it possible to ease the pressure on prices.

Fed officials, in the statement, appear less firm on future rate hikes than in previous meetings. They specify that they will observe the effects of successive decisions, and the delay with which they have an effect on the real economy, but also “economic and financial developments”, to decide whether or not to tighten further, in order to bring back inflation at 2%.

This marks a change in tone from previous meetings, when they anticipated the need to continue raising rates.

The banking crisis provided unexpected support for the Fed’s fight against inflation: “tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation “, underlines the Fed in its press release, hammering that “the American banking system is solid and resilient”.

And, while still resisting, the American economy multiplies the signs of shortness of breath, long awaited and finally visible.

Last week, first-quarter growth came in at 0.3% from the last three months of 2022 and just 1.1% annualized. And the probability of a recession, more marked than initially expected, is widely anticipated by the markets.

“Our data lead us to believe that the monetary tightening and the recent tensions in the banking system will lead to a mild recession, although stronger than what we had anticipated so far,” said the chief economist of Oxford Economics. , Ryan Sweet, interviewed by AFP.

The fragility of certain banking establishments came back to the fore with the fall of the regional bank First Republic, finally bought over the weekend by JPMorgan Chase, the number one in the sector.

The concern about the solidity of these medium-sized banks remains strong, several of them saw their title fall Tuesday on Wall Street.

“Fear is a very powerful feeling on Wall Street. When he walks in the door, the logic goes out the window,” commented Adam Sarhan of 50 Park Investments.

“The Fed needs to view ‘these banking difficulties’ as a game-changing event,” said LBBW’s Karl Haeling, and no longer see banks bearing the brunt of “isolated cases of mismanagement.”

Because these banks are suffering in particular from rising rates, which set the day-to-day cost of the money that institutions lend to each other. It has gone in just over a year from a range between 0 and 0.25% to values ​​between 4.75 and 5% now.

However, while inflation fell sharply in March, core inflation (excluding food and energy prices) barely slowed and is now higher than inflation itself.

Jerome Powell has been saying for months that getting US inflation back to its 2% target will be a long and difficult effort, but a necessary one, because sustained inflation would have even more detrimental consequences for the economy according to him.

Between May and December, the Fed had, in the face of persistent inflation, raised its rates at a rate not seen since the beginning of the 1980s, opting for two unusual hikes of half a point, and even, on four occasions, of three quarter points.