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What are the impacts of increasing or decreasing the federal funds rate?

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What are the impacts of increasing or decreasing the federal funds rate?

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The federal funds rate controls the available supply of funds in the market. Raising the federal funds rate makes it more difficult to investors to borrow money and keeps inflation controlled. Tightening the rates has the opposite effect. It allows for more borrowing and economic growth and therefore more inflation. There is a fine line that the Fed must walk to ensure the economy stays in balance.

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