Fed raises benchmark interest rate a quarter point
The US economy has mostly met the central bank’s goals of full employment and stable prices, and may get further support if President Donald Trump delivers promised fiscal stimulus
Washington — The Federal Reserve raised its benchmark lending rate a quarter point on Wednesday and continued to project two more increases this year, signalling more vigilance as inflation approaches its target. “In view of realised and expected labour market conditions and inflation, the committee decided to raise the target range for the federal funds rate,” the Federal Open Market Committee said in its statement. “Near-term risks to the economic outlook appear roughly balanced.” Investors had almost fully expected the increase to a range of 0.75% to 1% following unusually clear signals from policy makers including Chair Janet Yellen. “I’m a little bit surprised” Fed officials continued to forecast a total of three rate increases this year, said Daniel North, chief economist at credit insurer Euler Hermes, in Owings Mills, Maryland. “Inflation is rising, so I’ve been thinking they would project four hikes to keep the financial markets prepared” for a more rapid pace of rate moves...
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