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Rising Rates: The Fed Takes Next Step Toward Normal

Photo courtesy of Pixabay.

Prepared by Broadridge Investor Communication Solutions, Inc.

On December 14, the Federal Open Market Committee (FOMC) voted unanimously to raise the federal funds rate by 0.25% — to a range of 0.50% to 0.75%. This was the second increase since December 2008, when the benchmark rate was lowered to a near-zero level (0% to 0.25%) during the Great Recession.1

The rate hike was widely anticipated by investors, and the only element of surprise was a change in the forecast for the federal funds rate. The median projection for the end of 2017 is 1.4%, up from 1.1% in September, which suggests that Fed officials now expect three additional rate increases in 2017 instead of two.2

As the financial markets priced in the prospect of an extra rate hike, the yield on two-year Treasuries surged to its highest level since August 2009. The 10-year Treasury yield climbed to 2.523%, the highest level in more than two years and a full percentage point higher than the record low in early July 2016.3 (Bond yields typically rise as prices fall.) The S&P 500 index declined 0.8% on the day of the Fed’s decision, but recovered quickly and rose 0.4% the following day.4-5

Read more here: Rising Rates The fed takes next step toward normal

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Categories: Interest Rates

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Marty Higgins Women's Choice Award

MEET MARTY HIGGINS

Martin V. Higgins CFP, ChFC, CLU, AEP, LUTCF, RHU is a Certified Financial Planner, author and retirement income specialist who helps people prepare financially for retirement by designing written retirement income plans for people who may need to last 30+ years.

He is the CEO of Family Wealth Management and creator of “The WealthCare Process” designed to simplify and coordinate the financial affairs of his clientele of pre-retirees, retirees, widows and small business owners. He’s won the Women’s Choice Award for Financial Advisors and Firms.

His latest book “DistributionLand”, published in October 2014, immediately became an Amazon Best Seller and is a must read for anyone preparing for retirement.

 

The Women’s Choice Award Financial Advisor program was created by WomenCertified Inc., the Voice of Women, in an effort to help women make smart financial choices. The program is based on 17 objective criteria associated with providing quality service to women clients such as credentials, experience, and a favorable regulatory history, among other factors. Financial advisors do not pay a fee to be considered or placed on the final list of Women’s Choice Award® Financial Advisors, though they may have paid a basic program fee to cover the cost of a client survey through Advisor Impact. The inclusion of a financial advisor within the Women’s Choice Award Financial Advisor network should not be construed as an endorsement of the financial advisor by WomenCertified or its partners and affiliates and is no guarantee as to future investment success. This portion is updated periodically. Please access updated content here: http://www.womenschoiceaward.com/financial-advisor-information.

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