The Federal Reserve resumed meeting Wednesday to discuss raising interest rates for the first time since 2006 to end its long crisis stance in monetary policy.
The Fed is expected to announce at 2:00 pm (1900 GMT) that it is hiking the benchmark federal funds rate by a quarter point to 0.25-0.50 percent, after keeping it next to zero for seven years.
The move, which the Fed has signaled for months, would represent the central bank’s confidence in the US economic outlook and also kick off a likely slow series of rate hikes to “normalize” central bank policy over the next two years.
That ultimately will mean raising the cost of borrowing for everyone from foreign governments and companies to home and car buyers, while also better rewarding savers on their bank accounts.
A Fed rate increase “is a positive sign for the US economy — to be welcomed, not feared,” said Stuart Hoffman, chief economist at PNC Financial Services Group.
Well-warned ahead of time, global share markets surged Wednesday ahead of the rate decision, with Tokyo stocks up 2.6 percent, the Euro Stoxx 50 blue-chip index adding 0.9 percent and US stock markets expected to open higher.
The dollar meanwhile was little-changed at $1.0934 to the euro and 121.88 yen.