The central bank last hiked its benchmark rate in March.
As financial markets had anticipated, the policymaking Federal Open Market Committee, or FOMC, increased its benchmark target by a quarter point. The new range will be 1 percent to 1.25 percent for a rate that currently is 0.91 percent.
This move followed gold futures spiking higher suddenly Wednesday morning, after reports raised concerns about the state of the economy.
A shooting near the nation's capital involving members of Congress also added to fears, sending investors into the safe-haven trade.
U.S. gold futures for August delivery traded about 0.07 percent lower near $1,268.60 an ounce as Fed chairwoman Janet Yellen spoke, after futures briefly traded up more than 1 percent. Earlier, futures hit a high of $1,284.60, the highest since Friday.
Also on Wednesday, retail sales and the consumer price index (CPI) — a key inflation metric — came in weaker than expected. Retail sales fell 0.3 percent last month, marking their biggest drop in 16 months, while CPI declined 0.1 percent in May.
After the disappointing economic reports, gold futures reversed losses to trade about 1 percent higher.
Earlier in the day, House Majority Whip Rep. Steve Scalise, R-La., was shot in Virginia; he is in stable condition. Two U.S. Capitol Police officers were also shot, according to NBC. Several congressmen and at least two senators were present, Sen. Rand Paul, R-Ky., told MSNBC. They were practicing for a bipartisan charity baseball game set to take place on Thursday at Nationals Park.
U.S. stocks opened higher ahead of the Federal Reserve's decision on monetary policy.
On Wednesday afternoon, platinum was up 2.05 percent at $942.40 an ounce.
Silver was also climbing, up 1.47 percent to $17.108 an ounce after hitting its lowest in nearly a month the previous day at $16.68. Meanwhile, palladium was falling near 1.9 percent to $866.40.
— CNBC's Jacob Pramuk, Jeff Cox and Lauren Thomas contributed to this report.