US Interest Rates rise again as economy stands its ground

Washington (June 15)  The Federal Reserve announced its second interest rate of the year on Wednesday, pushing rates up from 1.75% to 2%. The move was widely expected and brings the US back to inflation levels last seen just before the Great Recession began in 2008.

Following the news of the rate rise, the S&P 500 index of US stocks fell 11 points before rebounding, while the 2-year bond yields and the US Dollar both gained value. The price of gold dropped to $1293.05 – the lowest it has been since May 21 – but this can partially be attributed to a stronger Dollar. Prices have since climbed back up to $1299.97.

Jerome Powell, the Chairman of the Federal Reserve, said in his press conference: “The main takeaway is that the economy is doing very well.

"Most people who want to find jobs are finding them, and unemployment and inflation are low.”

The US has a 3.8% unemployment rate, and the Fed are predicting 3.6% by the end of the year. The Reserve impressed upon those in attendance that the US economy is approaching a ‘normal’ level, meaning they can and will be less hands-on in the not-too-distant future. He also suggested there would be a further two increases to the interest rate this year.

USbullionPost

Silver Phoenix Twitter                 Silver Phoenix on Facebook