Fed can increase discount rate by 0.5%

Baku. 13 March. REPORT.AZ/ Two-day meeting of US Federal Reserve System (Fed) begins tomorrow. Decision on discount rate is expected to be adopted in the meeting. 

Report informs, global financial markets are sure that Fed will definitely increase discount rate by 0.25 percentage points. The reason for this is positive dynamics of economic indicators released in the US. Thus, according to the statistical report released last Friday, unemployment rate in US on February was 4.7%, the number of new jobs (excluding the agricultural sector) increased by 235,000 against forecasted 200,000. Also in February, hourly wage has grown by 0.2%. If positive trend of the economic indicators of inflation and interest rate gets closer to the target level of 2% limit may lead to the rise in target level.

Analytical Group of Report does not exclude increase in Fed's interest rate during the meeting on March 14-15 by 0.5% or 2 times more than ever. "In such case Fed can make a decision to increase interest rate one more time before the end of the year and global financial market will breathe more easily. In case of increase in discount rate by 0.5% by Fed, dollar will stronger for short-term and then drop sharply".