The Fed announced last Wednesday a 0.50% hike in the Federal funds rate, the largest increase in 20 years. While this is a big increase, and the Fed also stated that they expect additional hikes later this year, it’s important to look at things from a historical perspective and understand why they are raising rates. This week’s chart of the week shows the historical Fed funds rate going back to 1970. While rates are moving higher, they remain low when viewed from a historical perspective.

Source: New York Times