US interest rate hike is linked to all other interest rates 
Monday, 20 March 2017
The Federal Reserve Bank – the central bank of the United States of America – announced last week that its benchmark interest rate would be increased from 0.75% per annum to 1.0% per annum. The increase is, according to financial market parlance, is by 25 basis points and in terms of Sri Lankan standards where the central bank interest rates are between 7.0% and 8.5%, may be insignificant. But for Americans, it is an increase of the prevailing interest rate by 33%. Since the benchmark interest rate is the rate at which depository institutions with the Federal Reserve Bank would lend their surplus moneys to others on an overnight basis without collateral, it is linked to all other interest rates in the US economy as well as the global rates like the London Interbank Offered Rate or LIBOR. Hence, an interest rate increase by the Federal Reserve Bank is a global event rather than a mere local event.
US interest rates are to double in the year to come
US interest rate hike.docx by Thavam Ratna on Scribd
