US interest rate hike

THE US Federal Reserve has hiked interest rates for the third time this year as the nation’s economy continues its rapid growth.

It is now targeting a rate of between 1.25pc and 1.5pc – significantly ahead of Britain’s 0.5pc. Three further hikes are expected next year and again in 2019, increasing the American rate to 2.8pc.

The Fed’s policy- setting committee is expecting the economy to grow by 2.5pc next year, up from the 2.1pc forecast in September. Unemployment in 2018 is now expected to fall to 3.9pc, which is lower than the 4.1pc previously predicted.