Mar 17, 2017 01:06 PM EDT

Interest Rates Increased, Policymakers Confident In The Economy

Interest rates were raised by the United States Federal Reserve last Wednesday. Federal Reserve Chair Janet Yellen said that they are confident in the economy. 

According to news reports published by CNBC and Reuters, the Federal Reserve raised interest rates last March 15, Friday, in a sign of confidence directed towards the economy. The interest rate was raised by "25 basis points to a range of 0.75 percent to 1.00 percent."

This raise is the second in three months, writes CNBC. Janet Yellen, who serves the Chair of the Federal Reserve, shared that they have confidence on the path that the economy is on.

She stated that the economy has progressed in the last few months in a way that the Federal Reserve has anticipated. Any rate increases in the future will be gradual according to Yellen, and that the rate would not return to a neutral level based on its current pace, at least until the end of 2019.

Inflation is reportedly nearing the central bank's target of 2 percent. There are no plans, however, of accelerating monetary tightening. The chief investment officer at Commonwealth Financial, Brad McMillan, said that that news relieves the fears of some that the pace of increasing interest rates would go faster in the future, writes Reuters.

However, Yellen pointed out that the inflation target of 2 percent is not a ceiling. She didn't rule out the chances that inflation would go above or below that level. Yellen said that it is important to remind Americans that inflation can go above 2 percent or below it at certain times.

According to Reuters, the only official to claim disapproval towards the interest rate increase was Neel Kashkari, the Federal Reserve Bank President in Minneapolis. The increases came due to a sense of confidence by policymakers who believe that the economy is nearing the employment and inflation goals of the central bank.

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