TRACKING THE ECONOMY

AQUIL MUHAMMAD, ECON 202

Interest Rate

The Federal Funds Rate started at a blistering 6% in 2000. In 2001, the federal funds rate declined to 3.7% and was consistent with that during 2002. In 2003, it fell to 1.1% before rising again in 2004 to 1.3% and again in 2005 to 3.3%. In 2006-07, federal funds rate was consistent at 5% before falling into a recession in 2008-2009, where federal funds rate fell to 1.9% to 0.16% in 09. There was a small rise in 2010 with the rate raising to 0.18%, but not before falling again in 2011 to 0.1%. Growing slowly in 2012 to 0.12%, the federal funds rate appeared to stay consistent all the way until 2015, where is slowly rose to 0.7%. This year, we have had a consistent federal funds rate of 0.37% so it is safe to say in December 2016 the federal funds rate will be 0.37%.
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Economic Growth Rate

In the year 2000, the United States annual economic growth rate was at 4% before dropping to 0.9% in 2001. In 2002-2004 it rose from 1.7% to 3.7% before entering a recession in 2005, declining to 3.3%. This recession continued until 2009, dropping all the way to -2.7%. In 2010, it rose to 2.5% before falling again in 2011 to 1.6%. In 2012, the economic growth rate was 2.2% before falling to 1.4% in 2013. In 2014-2015, the economic growth rate stayed consistent at 2.4%. This puts the average economic growth rate form 2000-2015 at 2%, which is 1.2% lower than the historical growth rate of 3.2%.
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