U.S. likely to raise interest rates in June

May 19, 2016, 4:29 AM EDT
Federal Reserve Bank of Chicago
(Source: Ken Lund/flickr)

Bullish about the U.S. economic resilience to a potential slowdown in global markets, a majority of Federal Reserve members is prepared to raise interest rates in June. The minutes of the central bank’s last meeting in April showed that the Fed was cautious about a number of factors such as a modest economic growth in the first quarter, a possible Brexit next month and an uncertain Chinese economy.

The recent economic data projected the inflation to touch the 2 percent target, making the Fed members more confident for a June hike, writes the BBC. However, economists suggest the bank defer its next meeting, scheduled ahead of the E.U. referendum, so as to avoid “unsettling global markets” in case of Brexit.

Currently, the Fed keeps its interest rates between 0.25 percent and 0.5 percent, a range it reached in last December by the first hike in almost a decade, reports MarketWatch. Sal Guatieri, a senior economist at BMO Capital Markets, advised Fed Chair Janet Yellen to raise the tax only after finding a “convincing evidence of a sustained pickup in the economy.”

The recent rise in employment is expected to stimulate the U.S. economy, which grew at just 0.5 percent in the first quarter, believed the Fed’s committee.