The Federal Reserve has raised short-term interest rates for the second time in a decade and forecast a faster pace of tightening in the coming year. With the US on the cusp of full employment and inflation gradually approaching the Fed’s target, the central bank raised the target range for its federal funds rate by a quarter-point to 0.5-0.75%. Following a long procession of downgrades to its interest-rate forecasts in recent quarters, the Fed penciled in a median projection of three 25bps increases for 2017, up from two previously. The Central Banks of Kuwait, Saudi Arabia and Bahrain have followed suit and raised their respective benchmark interest rates by 25bps. (FT, Bloomberg)