The Federal Reserve increased its key rate by 0.25 percentage points, calling the banking system "sound and resilient".
But it also warned that fallout from the bank failures may hurt economic growth in the months ahead.
The Fed has been raising borrowing costs in a bid to stabilise prices.
But the sharp increase in interest rates since last year has led to strains in the banking system.
Two US banks - Silicon Valley Bank and Signature Bank - collapsed this month, buckling in part due to problems caused by higher interest rates.
There are concerns about the value of bonds held by banks as rising interest rates may make those bonds less valuable.
Banks tend to hold large portfolios of bonds and as a result are sitting on significant potential losses. Falls in the value of bonds held by banks are not necessarily a problem unless they are forced to sell them.