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US Stocks Take Modest Hit As Feds Raise Interest Rates

Posted: Wednesday, December 14, 2016 – 12:08 PM

(AFP) Wall Street stocks fell modestly and the dollar advanced after the Federal Reserve Wednesday lifted its benchmark interest rate for only the second time in a decade.

The policy-setting Federal Open Market Committee voted unanimously to increase the key federal funds rate to a range of 0.5 to 0.75 percent, but repeated that it expects the world’s biggest economy will require only “gradual” increases going forward.

The Fed projected that it now expects three interest rate increases in 2017, up from the September plan of just two increases.

Near 1940 GMT, the Dow Jones Industrial Average was at 19,874.92, down 0.2 percent and retreating from its proximity to the 20,000 landmark.

The broad-based S&P 500 shed 0.3 percent to 2,265.11, while the tech-rich Nasdaq Composite Index lost 0.1 percent at 5,456.70.

The euro fell to $1.0589, compared with $1.0646 shortly before the announcement. The dollar also rose against the pound and the yen.

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