In December, the American government announced that 211,000 new jobs had been created and delivered by the U.S. economy in the month of November, keeping the unemployment rate at 5%. This huge announcement set off a wave of debate and discussion on if and when the Federal Reserve will finally make the decision to raise interest rates in their upcoming December meeting.
A fast survey revealed that the Federal Reserve has the green light to raise the interest rate. So what does this mean for all small business owners in the U.S. and their access to capital? Fast and Easy Funds, an independent lending company that offers working capital for small to medium sized businesses, weighs in on the possibility that the Fed may raise interest rate.
Now that small companies are picking up in business and jobs are increasing at a strong pace, business owners are gaining confidence in their ability to dip into cash reserves or take on outside capital to expand their business. The economy has strengthened significantly, and the zero percent rates should be reassessed to begin the normalization process.
The zero percent rate was put in place by the Federal Reserve as an extraordinary measure to help boost the economy during the recession. Increases are expected to be slow and gradual, so that small businesses should feel little impact. The bottom line is that small businesses will benefit significantly more from a strong economy, which is associated with higher interest rates.
The Federal Reserve is meeting on December 15 and 16 and will announce their decision soon thereafter. Fast and Easy Funds knows that if they do decide to hold off on raising rates, it will not be for too long.