URGENT: U.S. Fed slows pace of interest rate increases with 0.5-point hike

The U.S. Federal Reserve on Wednesday decided to raise its benchmark interest rate as it continues to battle high inflation, but by a smaller 0.5 percentage point than the previous four hikes.

While lifting the target range of the federal funds rate to 4.25 to 4.50 percent, the central bank also revised upward an estimate for where the hikes will ultimately top out in a policy tightening cycle, expecting the so-called terminal rate to be 5.1 percent.