The U.S. Federal Reserve on Wednesday decided to carry on with its aggressive interest rate hikes amid stubbornly high inflation, a move that could further weaken the yen against the U.S. dollar.

Upon concluding a two-day meeting of the policy-setting Federal Open Market Committee, the central bank said it will lift its target range for the federal funds rate by 0.75 percentage point, the same as increases decided in its previous two meetings, to reach a level of 3.00 to 3.25 percent.

The increase is triple the size of the Fed's usual hike of 0.25 point at any given time.

"The committee is highly attentive to inflation risks," the central bank said in a statement, noting that Russia's war in Ukraine is creating additional upward pressure on prices and "weighing on global economic activity."

The central bank also said it anticipates that "ongoing increases in the target range will be appropriate."

In its new economic projection released the same day, the Fed expected the benchmark borrowing rate to come to 4.4 percent at the end of 2022 and reach 4.6 percent in 2023, up from June projections of 3.4 percent and 3.8 percent, respectively.

Gross domestic product was estimated to grow a real 0.2 percent in the fourth quarter of 2022, revised downward from the earlier estimate of a 1.7-percent expansion. The unemployment rate was projected to be 3.8 percent in 2022, higher than the earlier forecast of 3.7 percent.

The Fed has been showing its determination to continue tightening its monetary policy to tamp down inflation, even at the cost of slower growth.

The widening divergence in monetary policy between the Fed and the dovish Bank of Japan has been driving the yen sharply lower, even prompting Japanese monetary authorities to suggest the possibility of direct market intervention to arrest the Japanese currency's decline.

A weak yen, once welcomed as a boost to exporters and the broader economy, is creating headaches for import-dependent, resource-scarce Japan.

The yen has continued its rapid depreciation from earlier this year, as the Fed began in March its rate lift-off from near-zero, which had been maintained to support the economic recovery from the coronavirus pandemic.

Earlier this month, the yen faced renewed selling pressure after U.S. consumer price index data for August came out stronger than expected, dashing hopes that the Fed would be less aggressive in raising rates.

The Fed aims to achieve maximum employment and long-term inflation at a rate of 2 percent.

The central bank projected that inflation -- gauged by the price index for personal consumption expenditures -- was to rise to 5.4 percent by the end of 2022 from a year before, an upward revision from the June forecast of a 5.2 percent increase.

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