Fed could raise rates this month: Yellen

Chair points to higher employment, inflation

Janet Yellen (Credit: Getty Images)
Janet Yellen (Credit: Getty Images)

The Federal Reserve is increasingly likely to raise short-term interest rates at its March meeting, comments by Fed chair Janet Yellen indicate.

“Indeed, at our meeting later this month, the Committee will evaluate whether employment and inflation are continuing to evolve in line with our expectations, in which case a further adjustment of the federal funds rate would likely be appropriate,” Yellen said Friday in Chicago, the Wall Street Journal reports.

The Federal Reserve’s decision-making body, the Federal Open Market Committee, is set to meet on March 14 and 15. The potential for more government spending under the Trump administration and an improving economy make another interest rate hike more likely. The Fed last raised rates in December.

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“The economy has essentially met the employment portion of our mandate and inflation is moving closer to our 2% objective,” Yellen said in her speech at the Executives’ Club.

The real estate industry has been paying close attention to the Fed’s moves because short-term interest rates tend to lead to higher mortgage rates and put downward pressure on cap rates. [WSJ]Konrad Putzier