In spite of the predictions that the inflation will increase this year, the US Federal Reserve made no changes concerning the current interest rates. Thus, at 31st of January 2018, they will still the same. But, according to Jerome Powel, who is the chief of the central US bank, the costs connected to borrowing will continue to follow their ascending trend. In 2018, the economy is expected to rise at a steady pace while the labor market continues to be strong. These are due to the fact that the employment improved, the spending per household, and capital investments increase.
As the Feds stated recently, it is expected for the inflation to raise this year, but not exceed the 2% target set for a period of 12 months. So, even if the increase will take place, Feds also expect it to stabilize at one point as well. But this is not the only change that will happen during this period, as the committee that sets the rates selected a new chief for their bank, by his name Jerome Powel, as mentioned earlier. Powel, a former Fed governor, is going to replace Yellen, whose policies are expected to be closely followed by Powel. Yellen became famous for the policies that were meant to repair the economy affected by the recession that took place between 2007 and 2009, which was accomplished by moving interest rates from almost zero to slightly higher percentages in a gradual manner.