US federal Reserve raises interest rates for second time in a decade

The US Federal Reserve has raised its benchmark interest rate by 0(point)25 per cent, only the second increase in a decade and first in 2016. The central bank voted unanimously to raise the key rate to a range of 0.5 per cent to 0.75 per cent, citing a stronger economic growth and rising employment.

Chair of the Federal Reserve System Board, Janet Yellen told reporters in Washington that the economic outlook was highly uncertain and the rise was only a modest shift. She said, the increase in the



federal funds rate is appropriate in light of the progress the country has seen toward the goals of maximum employment and two per cent inflation.

Ms Yellen said, the evolution of the economy will warrant only gradual increases in the federal funds rate over time to achieve and maintain our objectives. She said, the economy will expand at a moderate pace over the next few years. US President-elect Donald Trump has promised policies to boost growth through tax cuts, spending and deregulation.