An expected hike

Fiscal protectionism in the US is a bigger concern than the Fed rate

Given tight labour markets, strong gross domestic product (GDP) growth and rising inflation, it was no surprise that the US Federal Reserve raised the so-called Fed Funds policy rate for the second time in succession. The 25 basis points hike was in line with the market consensus. Despite two successive hikes, rates remain low in historic terms. The Federal Open Market Committee said, “The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate.” The market took heart from the “gradual” bit and the statement is not being interpreted as