March 16th, 2017 10:28 AM by Dawn m. Holmes
The Federal Reserve voted on Wednesday to again raise the key interest rate one-quarter percentage point, the first of three hikes anticipated for 2017. The rate was increased one-quarter percentage point just three months ago, in December 2016.
“In view of realized and expected labor market conditions and inflation, the [Federal Open Market] Committee decided to raise the target range for the federal funds rate to 3/4 to 1 percent,” according to a statement by the Fed. “The stance of monetary policy remains accommodative, thereby supporting some further strengthening in labor market conditions and a sustained return to 2 percent inflation.”
The probable decision, which followed encouraging employment figures in February, marks a turning point in policy. The Fed raised the rate only twice in the past decade; Wednesday’s decision quickens the pace, signaling the potential for more aggressive action as the year unfolds.