Forex
US Fed, ECB hike interest rates
THIS was the eagerly awaited week of interest rate decisions. The US economy has commenced its 107th month of unbroken expansion. In an effort to tame the blistering growth and prevent the economy from overheating, the US Federal Reserve raised the disco unt rate and the federal funds rate by 25 basis points to 5.25 per cent and 5.75 per cent respectively. The Fedreserve said it hiked the rates because it remained concerned that increases in demand will continue to exceed the growth in potential supply, even after taking into account the rise in productivity growth. The hike was largely expected and it led to the euro touching a new record low of $0.9660 on Tuesday.

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