(by Sh. Nakata)

Wednesday FOMC meeting is expected to lead to another rate hike as the economy is in need of strengthening.

U.S. Federal Reserve policy makers on Wednesday meeting are forecast to raise interest rate by another 0.25 percentage point to 2.00% from the prior 1.75%.

"The reason for raising rates is that there is still an enormous adjustment to be made considering that we have an economy that is approaching its full potential," said economist Richard DeKaser of Cleveland-based National City Corp. "At the same time, inflation is no longer declining and in fact has been rising and, in all likelihood, is back within the Fed’s ’comfort zone’ of 1.5% to 2%."

Higher oil is expected to be one of the main reasons for lifting rates as higher oil prices may lead to inflation growth.

``It seems clear that the fed funds rate will need to rise as we go forward, but the pace of that increase will need to be closely linked to unfolding events,’’ said Fed official Janet Yellen.