- February 1, 2016: Vol. 28, Number 2

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Going up: The Fed raises interest rates for the first time in nearly a decade

by Loretta Clodfelter

Some of the biggest economic news of 2015 happened at the very end of the year. The Federal Open Market Committee raised the federal funds rate target at its meeting in mid-December — the first change since the rate hit virtually zero in 2008 and the first increase since 2006, increasing the rate from a range of 0–0.25 percent to a range of 0.25–0.5 percent.

Speaking at a press conference Dec. 16, Fed chair Janet Yellen remarked, “This action marks the end of an extraordinary seven-year period during which the federal funds rate was held near zero to support the recovery of the economy from the worst financial crisis and recession since the Great Depression. It also recognizes the considerable progress that has been made toward restoring jobs, raising incomes and easing the economic hardship of millions of Americans. And it reflects the committee’s confidence that the economy will continue to strengthen.”

The move itself was small, only 0.25 percent. To som

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