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Potential Fed Rate Hike Delayed

hamilton-zanze April 10, 2015

The Federal Reserve’s much-anticipated rate hike may be delayed by the recent strength of the U.S. dollar weighing on exports and manufacturing, as well as the recent weak employment report.

Earlier this year, the central bank dropped from its guidance the buzzword “patient” (previously used to describe the Fed’s approach to raising the federal funds rate), signaling an impending increase in interest rates.

This would be the first Federal Reserve rate hike since 2006. Since the financial crisis, the Fed has kept the rate between zero and a quarter of a percentage point in an effort to boost the economy.

An increase in U.S. interest rates could lead to higher lending rates and a corresponding decline in the number of potential borrowers, including homebuyers. Fed representatives say they are unlikely to raise rates until later in the year, although some economists believe the recent dip in job growth might lead the Fed to delay an interest rate increase at least until September.

Read more at the Washington Post

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