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The U.S. raised its benchmark interest rate by another 0.25 percentage points. The U.S. central bank, the Federal Reserve, initially signaled a larger rate hike, but when financial markets became unsettled due to bank failures, it is understood that it began to adjust the pace of hikes.

Junmo Moon is a reporter.

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The
U.S. Federal Reserve raised interest rates by 0.25 percentage points again last month.

The Fed initially raised its hikes again and repeatedly hinted at raising interest rates by 0.5 percentage points when the overheated U.S. economy showed no signs of slowing down, but the recent bank failures have fueled financial instability.

Powell said the incident would tighten credit conditions for banks, which in turn would have a similar effect to tougher monetary policy.

[Jerome Powell/Federal Reserve Chairman: We decided to raise by 0.25 percentage points, and in the future, we decided to change our policy policy from a sustained hike to some additional hikes.]

Chairman Powell, who admitted that he had even considered freezing interest rates in the immediate aftermath of the bank failure, dismissed market expectations, saying there would be no rate cuts this year.

[Jerome Powell/Federal Reserve Chairman: We considered freezing interest rates at the meeting, but we won't cut rates this year. That's what the participants at the meeting think.]

The New York stock market fell en masse after U.S. Treasury Secretary Janet Yellen said she was not considering measures to protect deposits at all banks.

The Dow, S&P 500 and Nasdaq all ended the day down about 1.6%.

Today's rate hike brought the U.S. benchmark interest rate between 4.75% and 5%, the largest inversion in 2000 years since 22, to 1.5 percentage points, raising concerns about capital outflows.

(Video Interview: Cho Moo-hwan)