The U.S. economy has been strong enough that the Federal Reserve Board saw fit to raise its key interest rate a quarter-point to prevent an excessive growth spurt as the season changes.
Just as the spring equinox signals a resurging Nature, the Fed signalled its belief that the national economy is strong enough to continue growing and no longer needs easy access to borrowing through low interest rates to fertilize its roots.
After its meeting this month, the Fed's Open Market Committee noted that the economy "has strengthened in recent months," and with "further gradual adjustments in monetary policy, economic activity will expand at a moderate pace in the medium term." Moreover, the committee expects economic conditions "will warrant further increases."
Translation: Look for more hikes in interest rates this year as economic recovery continues. The Fed said it would boost its target interest rate for federal funds to a range of 1.5 percent to 1.75 percent.
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