Mike Carson

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Cell 604-740-1841

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U.S. raises interest rates for first time in almost 10 years

The U.S. Federal Reserve raised its federal fund rate from zero to .25 percent this morning, the firs rate hike in almost a decade, and indicated that further increases will be gradual.  The Fed said it raised rates “given the economic outlook, and recognizing the time it takes for policy actions to affect future economic outcomes.”  In a related move, the Fed’s Board of Governors unanimously voted to raise the discount rate, which covers direct loans to banks, by a quarter point to 1 percent, which could signal a slight rise in U.S. mortgage rates.  The 25 basis point uptick is seen as a vote of confidence for the U.S. economy and could also boost real estate prices in that country.  Time will tell how this will trickle down to our own local economy, but we all know that if we want to have a hint as to what the future holds, to keep an eye on what is happening south of the border.

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