The Federal Reserve raised its benchmark interest rate target range by 0.25%, leaving room for additional hikes this year.

The fed funds rate rose to 5.25%-5.50%, the highest level since March 2001.

Future rate hikes will depend on the economy and financial markets.

The process of lowering inflation to 2% has a long way to go, with a period of below-trend growth and softening labor market conditions.

Fed Chair Jay Powell reiterated that inflation remains “elevated” and they remain “highly attentive” to inflation risks.

The Fed now anticipates inflation to finish the year at 4%, up from 3.6% and nearly beyond its objective.

Economic growth is now called “moderate,” with recent indicators suggesting moderate expansion and strong job gains.