Fed Expected to Boost Interest Rate to 4.25% on Tuesday

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he Federal Reserve is likely to boost interest rates another quarter-percentage point to 4.25% on Tuesday, news services reported.

The action would mark the 13th such increase since June 2004 and would put the rate at its highest level in more than four years, the Associated Press reported.

The central bank gradually has increased rates for the past 18 months to control inflation, AP said.

After Tuesday’s expected action, economists are divided about what will happen after that, saying the Fed could either boost rates by another quarter-point at its next meeting Jan. 31, or vote for an increase in both its January and at its following meeting March 28, AP said.

If the Fed acts as expected on Tuesday, the prime lending rate — for certain credit cards, home equity lines of credit and other loans — would increase to 7.25%, the highest in more than four years, AP reported.