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FED HIKES INTEREST RATES: Fourth time this year, despite Trump pressure (FNN)

1,230 views · Published 19 December 2018 · 45:41 · Indexed 28 September 2026

Channel: LiveNOW from FOX · 2018 · News & Politics

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The Federal Reserve on Wednesday raised short-term interest rate for the fourth time this year, but signaled a slower pace of gradual rate hikes next year, expecting to hit neutral by the end of 2019.

As expected, policymakers at the central bank said they voted to hike the benchmark federal funds rate by a quarter percentage point, setting a range of 2.25 percent to 2.5 percent.

Wall Street and investors were closely watching the Fed’s announcement after Chair Jerome Powell struck an optimistic note about the state of the U.S. economy in November, suggesting that interest rates are nearing neutral.

"The Fed continues to see that the economy has been continuously surpassing expectations throughout year, with exceptional job growth rates month after month in a labor market that has had very little slack, which demonstrates just how healthy it is," said Steve Rick, chief economist at CUNA Mutual Group. He noted the fourth hike was "not at all surprising."

The policymakers anticipate interest rates will hit neutral by the end of 2019, but suggested there would be one more hike in 2020 before holding steady.

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