The Federal Reserve voted unanimously on Wednesday to raise interest rates by a quarter point. This is the first increase in over nine years. The bank raised its fed funds rate to a range of 0.25% to 0.5%, ending an unprecedented seven-year run of near-zero interest rates. The vote was unanimous 10-0.
The board of directors also raised the discount rate to 1% from 0.75%. The Fed said it will “carefully’monitor” actual inflation in light of ‘current shortfall.” And given current economic conditions, the bank said interest rates will most likely increase in a “gradual” manner, ending up at a long-run target of 3.5%. That was unchanged from its September forecast.
Source: The Wall Street Journal
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