Wednesday, December 16, 2015

From One Quarter To One Half

At long last, a rate hike for the history books. The Federal Reserve has raised the interest rates for the first time in 9.5 years.

In a landmark step, the US central bank announced a quarter-point increase in the target range for the federal funds rate to 0.25-0.5 per cent, lifting it from the historic lows it has occupied since December 2008, when the US was mired in an economic crisis that would ultimately drive unemployment to 10 per cent.

 The increase comes amid signs of a steady US recovery, with consumer spending growth holding firm and unemployment standing at just 5 per cent, lower than the 5.3 per cent rate that was prevailing when the Fed last kick-started an interest rate-raising cycle in 2004.


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