This week, the U.S. Federal Reserve is expected to raise its benchmark interest rate, the Washington Post reports. This would be the first increase in nearly a decade. A formal announcement is slated for Wednesday afternoon.
A rate increase is the first step in getting the economy and Fed policy back to normal. It will start a process that will last several years, with the next step being when to raise rates again. Officials say the best move is to gradually test the response of financial markets in both the U.S. and across the world.
Investors believe that the Fed’s fall forecast, which said officials will push the benchmark interest rate up to a median of 1.4 percent at the end of 2016, is too optimistic.