Interest rates in the United States are expected to rise sharply for the first time in 30 years, according to global markets

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NEW YORK :  According to sources, the global financial markets are bracing for the highest increase in US interest rates in over 30 years as America’s central bank takes steps to combat rising inflation.

Following days of feverish investor speculation and evidence of rising central bank concern, the Federal Reserve is expected to raise the official cost of borrowing by 0.75 percentage points for the first time since 1994.

A European Central Bank (ECB) emergency meeting will take place before the Fed meeting to tackle Italy, Spain, Portugal, and Greece’s falling bond prices.

The Bank of England is expected to raise interest rates on Thursday, following a 40-year peak in UK inflation. Despite predictions that the rate would rise by 0.5 percentage points, the City anticipates a 0.25 percentage point increase to 1.25 percent.

The Fed’s chairman, Jerome Powell, had previously ruled out a 0.75 percent boost, but the central bank appears to have altered its mind after higher-than-expected US inflation was revealed last week, according to the article.

The announcement that the US cost of living index had increased to 8.6%, the highest level in four decades, caused a huge sell-off in bonds and stock prices, as investors feared that action to combat excessive inflation would lead to recession.