US rates continues to cause global effects

US central bankers are predicted to increase a key interest rate again this week in return to healthy growth and low unemployment.

Decision makers at the US Federal Reserve are anticipated to raise the target for the Federal Reserve’s benchmark rate by 0.25%, taking it to the highest since 2008, at 1.75% to 2%.

A rise would sign the Fed’s seventh rate increase since 2015.Officials target to head off excessive inflation with higher rates and think the US economy can handle higher borrowing costs.

They are also declining the Fed’s massive holdings of government debt and mortgage-backed securities, which were purchased to lift the economy out of the recession that ran from late 2007 to 2009.

As higher rates start to take hold, the repercussions are being felt in the US and overseas.

Some of the most dramatic effects have occurred in emerging markets, as higher US rates lure back investors who had turned overseas in recent years in search of returns.