Minutes released from the meeting of the committee of the Federal Reserve last month showed that although they voted unanimously for the rate hike, many members are not as confident about the economy in the United States as suggested by its projections.
Specific concerns expressed by the Fed were related to inflation and the rising strength of the dollar and emerging markets. There were also some lingering concerns that the dollar may appreciate more, and persistent weakness in commodity prices could increase the stress on the economies of emerging markets. To address these concerns, the Fed set its short-term interest rate at 0.25% last month and forecasted that by the end of the year, the rate could be 1.25%.
Wall Street, however, sees the rate going up to 0.75% at best, making for a big gap in the world of investment.
The vice chairman of the Federal Reserve, Stanley Fischer, said that the market is underestimating where the economy will be later in the year. He argues that falling oil prices and a stronger dollar, which may be holding back the economy in the United States right now will most likely subside later in the year. This could be good news for people who are looking to start a business service franchise or look to other franchise business opportunities.
Fischer added that there may be some uncertainty about how many rate hikes the Fed will implement this year but the goal of four rate hikes for 2016 is a good possibility.