Wednesday, February 01, 2017

Federal Funds Rate to remail low

The Federal Reserve met today and decided that the Federal Funds Rate will remain low - holding steady between 0.50% and 0.75%.

Since financial market experts predict several rate increases in 2017, now is the time to get your finances in order before mortgage rates rise.

When the Fed Funds Rate is low, the Fed is attempting to promote economic growth. This is because the Fed Funds Rate is correlated to Prime Rate, which is the basis of most bank lending including many business loans and consumer credit cards.

It's a common belief that the Federal Reserve "makes" consumer mortgage rates. It doesn't. The Fed doesn't make mortgage rates. Mortgage rates are made on Wall Street.

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