RIYADH: Inflation is becoming a worry for all economies. The US took a step against it by raising the interest rates on Wednesday, while Russia sees inflation on the rise. Fed hikes interest rates, signals aggressive battle against inflation The Federal Reserve on Wednesday raised interest rates by a quarter of a percentage point and laid out an aggressive plan to push borrowing costs to restrictive levels by next year as concerns about high inflation and the war in Ukraine overtook the risks of the coronavirus pandemic. The US central bank, in a surprise move, projected the equivalent of quarter-percentage-point rate increases at each of its six remaining policy meetings this year, which would push its benchmark overnight interest rate to a range between 1.75 percent to 2.00 percent by the end of 2022. It is projected to further rise to 2.80 percent by the end of next year, above the 2.40 percent level officials now feel would slow the economy. Fed Chair Jerome Powell, speaking after the end of the latest two-day policy meeting, said the economy is strong and that officials will raise rates more aggressively at future meetings if needed to control inflation. “The way we’re thinking about this is that every meeting is a live meeting,” Powell said in a news conference. “We’re going to be looking at evolving conditions, and if we do conclude that it would be appropriate to move more quickly to remove accommodation, then we’ll do so.” An economic slowdown, however, may already be underway. Fed policymakers marked down their gross domestic product growth estimate for 2022 to 2.8 percent, from the 4 percent projected in December, as they began to discount the new risks facing the global economy. Russia"s Inflation The impact of the Russia-Ukraine conflict can be felt all across the world amid fears of soaring oil prices and supply chain disruption. The annual inflation in Russia accelerated to 12.5 percent as of March 11, its highest since late 2015 and up from 10.42 percent a week earlier, the Economy Ministry said on Wednesday. Inflation accelerated sharply as the currency fell to an all-time low amid signs of increased demand for a wide range of goods, from food staples to cars, on expectations that their prices will rise further. Weekly inflation slowed slightly to 2.09 percent in the week to March 11 from 2.22 percent a week earlier, which was the sharpest one-week increase in prices since the 1998 crisis, data from statistics service Rosstat showed. The central bank, which targets annual inflation at 4 percent, raised its key rate to 20 percent in late February. “Tight monetary conditions facilitate inflation slowdown but, in our view, they won’t save it from soaring above 20 percent this year,” Raiffeisen Bank analysts said. French confidence weakened French economic growth is holding up for now despite the energy price shock from the Ukraine crisis, but business and consumer confidence is falling fast, the INSEE official statistics agency said on Wednesday. The euro zone’s second-biggest economy is on course to grow 0.3 percent this quarter, down from 0.7 percent in the fourth quarter but unchanged from a previous estimate last month, it said. While limited so far, the economic impact of the Ukraine crisis could take a bigger toll going forward, especially through energy prices. If energy prices remain at elevated levels seen at the start of March for the rest of the year, the French economy would lose around a percentage point of growth, the agency estimated. It said early results coming in from its monthly business confidence survey showed a sharp deterioration, especially in the manufacturing, wholesale and retail sectors. In the face of high energy prices, executives are expecting price pressures to get sharply worse — with the exception of the service sector. German consumption Soaring energy prices due to Russia’s war in Ukraine will dampen private consumption in Germany this year, the Economy Ministry said on Wednesday, although it is too early to quantify the impact on growth. The ministry said in its monthly report that the impact of Russia’s invasion on economic output depended on the duration and intensity of the conflict which began on Feb. 24. The economy contracted in the final quarter of last year and an investor sentiment index published on Tuesday fell sharply, pointing to a likely recession. The ministry said accelerating inflation remained a major concern for the economy and that consumers and companies would probably have to grapple with higher energy bills given that Germany remains dependent on Russian gas and oil. “Since the start of the military invasion there have been extreme increases in the price of energy and commodities,” it said. “Trade flows and supply chains are also strongly impacted.” Gas and electricity bills for German householders entering into new contracts hit a record high this month and will filter down to the rest of the population, data showed on Wednesday. The government of Chancellor Olaf Scholz, which is led by his Social Democrats with the Greens and Lindner’s pro-business Free Democrats as junior partner, had already taken some measures to cushion the economic impact of the war and the resulting surge in energy prices. A surcharge on electricity bills to fund renewable energy expansion will be dropped starting in July instead of next year and companies with business in Russia can apply for grants.