Interest Rate Hike

Interest Rate Hike
Federal Reserve officials discussed raising interest rates soon to counter excessive economic strength but also examined how global trade disputes could batter businesses and households.

The Fed, which released the readout from its July 31-Aug. 1 meeting on Wednesday, has been raising rates gradually since 2015 and is now concerned the economy is so strong that inflation could rise persistently above its 2 percent target.

   

The Fed has raised rates twice this year and is widely expected to tighten policy again next month. Fed policymakers generally noted that spending by U.S. households and businesses appeared to have “considerable momentum,”. Fed officials also generally expected the economy would grow at a fast enough rate to put upward pressure on inflation, which recently has come close to the central bank’s target. With interest rates rising, many policymakers said the Fed would soon have to stop describing monetary policy as giving a boost to the economy.

Reuters Business News | Jason Lange