“The Federal Reserve increased short-term interest rates on Tuesday by one-quarter of a percentage point, to 1.5 percent, and strongly implied that it would keep raising rates modestly but regularly in the months ahead,” writes Edmund Andrews in today’s New York Times.

“Analysts had almost uniformly expected the increase, the second such move since June 30.”

“But the Fed, the nation’s central bank, was tougher in a statement issued after the meeting than some had thought it would be, and this increased the prospects that policy makers would follow up with an additional rate rise at their next meeting in September, less than six weeks before the election.”

“In the statement, the rate-setting Federal Open Market Committee acknowledged that economic growth and job creation had both slowed but said that the economy ‘nevertheless appears poised to resume a stronger pace of expansion.’ ”

“The Fed also reiterated statements pointing to a series of small rate increases that are widely expected to stretch over the next year or so. And it raised another benchmark interest rate, the discount rate on loans to big banks, also by a quarter-point, to 2.5 percent.”

” ‘We read it as pretty hawkish,’ said William C. Dudley, chief United States economist at Goldman, Sachs, the Wall Street investment bank. ‘There was no hint here that the Fed is inclined to stop. They could have left open an escape hatch, but I don’t see any escape hatch here.’ ”

“Though investors often sell stocks when they see interest rates rising, the stock market reacted positively to the Fed’s statement that it expects economic growth to rebound soon. The Standard & Poor’s 500-stock index, a broad measure of the performance of large stocks, rose 1.3 percent yesterday, as did the Dow Jones industrial average, which advanced just over 130 points, to 9,944.67. The technology-focused Nasdaq composite index closed up 1.9 percent, at 1,808.70.”

“Investors appear not only to have been encouraged by the Federal Reserve’s positive outlook on the economy but may have been reassured that policy makers demonstrated steadiness rather than anxiety in carrying out their plans.”