Fed Raises Interest Rates, Signals More Increases to Come

Published on:
12 September 2006 at 10:21 a.m. ET

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http://www.insidearm.com/news/00001529-fed-raises-interest-rates-signals-more-in/

Recently installed Fed chief Ben Bernanke raised interest rates yesterday as his first official act in his new role. Bernanke replaced Alan Greenspan. The benchmark federal funds rate was increased from 4.5 to 4.75.

The dollar rose, U.S. stocks and bonds fell, and some analysts furiously backpedaled from earlier statements that the end of rate hikes was near after catching wind of the higher credit costs ahead. The new rate is the highest it has been since April of 2001. But don’t get comfortable with the new rate; it’s likely that Bernanke and crew will raise the rate to a solid 5 when they meet again in May.

You can read more of this story by visiting Fed raises U.S. rates, says more may come.