Federal reserve expected to raise US interest rates

THE US Federal Reserve is expected to increase interest rates for the first time in more than four years when the Open Market Committee meets next Wednesday.

The potential impact on the economy and burgeoning US housing market is expected to limit the increase to 0.25% but as inflation begins to take hold, the rise is expected to be one of many over the coming year.

The US economy continues to thrive. Just yesterday, data from the Commerce Department revealed a surge in new home sales by 14.8% in May to an annual rate of 1.369 million new homes, compared with 1.192 million in April.