Rate Increases, at an Increasing Rate
After slashing interest rates to near zero as part of the biggest economic stimulus program since the Great Depression, it took the Federal Reserve seven years to raise interest rates again. It took the Fed another year to apply a second rate hike, and only three months for a third. As they accelerate restoration of more typical interest rates, the Fed has signaled two more rate hikes for the remainder of 2017 and three for 2018.
Are Fed interest rate hikes good news or bad news for you? There could be elements of both, depending on your overall financial situation.
It's important to note that the Fed Funds rate (what banks charge other banks for overnight borrowing) is still very low in historical terms. The average interest rate from 1971 through 2016 was 5.81%, and that includes seven years of near-zero rates. In March 1980, interest rates were a whopping 20%.
We are gradually returning to a more ...
from MoneyTips https://www.moneytips.com/todays-headlines-how-fed-rate-hikes-affect-you/667
No comments:
Post a Comment