US Fed Raises Key Interest Rate Amid Stronger Growth Outlook

Washington, (UrduPoint / Pakistan Point News - 22nd Mar, 2018 ) :The Federal Reserve on Wednesday raised the key lending rate for the first time this year to its highest level in a decade, citing a stronger outlook for US economic growth. Newly installed Fed Chairman Jerome Powell presided over his first meeting, which raised the federal funds rate to 1.5-1.75 percent, a move that will affect all types of loans, from homes to cars to student debt. In his first press conference as Fed chief, Powell pointed to the factors that have boosted the economic outlook in recent months, including "more stimulative" fiscal policy, in the wake of the massive tax cuts Congress passed in December.

In addition, he said "ongoing job gains are boosting incomes and confidence (and) foreign growth is on a firm trajectory." That likely caused Fed officials to signal they expect a slightly more aggressive path for rate increases next year. Still, Powell told reporters that even with rising interest rates, the world's largest economy is "healthier than it has been since before the financial crisis.

It's a healthier economy than it has been in 10 years." However, he also acknowledged that central bankers now consider the prospects of a global trade war as a "more prominent risk" to the economic outlook.