Fed hikes interest rate, hits brakes on growing economy

The Washington Post ------- The Federal Reserve raised its benchmark interest rate by 25 basis points on Wednesday, launching into what's expected to be a more rapid series of increases that is intended to ward off inflation but will also raise costs for Americans who borrow money to finance mortgages, auto loans and credit card purchases. Fed officials voted unanimously to raise the central bank’s key interest rate for overnight lending by a quarter point, from a range of 0.5 percent to 0.75 percent to a range of 0.75 percent to 1.0 percent. Bank officials announced the decision Wednesday afternoon following a two-day policy meeting in Washington.

The Fed has long planned on raising interest rates to a more normal level, after slashing them to nearly zero during the financial crisis and holding them at an ultra-low level for years to stimulate a sluggish economy. After some tentative steps, Wednesday hike -- and its unanimous support among officials -- signals a significant transition “This is a sea change for them, to start talk about raising rates at a faster pace,” said Blu Putnam, CME Group’s chief economist. To get more in depth information click on the picture below to read the article.