In a move this afternoon to lower the risk of recession, the federal open market committee, voted to lower two key interest rates by a quarter point. The central bank lowered the federal funds rate, the rate at which banks lend each other money overnight, to 4.50%. The federal discount rate was also lowered to 5%, making it cheaper for commercial banks and other depository institutions to borrow money when attempting to reduce liquidity problems.
The FOMC also hinted to the fact they may halt any further decreases, and basically play it by ear, and watch as other economic data comes in prior to their next meeting in December. The fed expressed concern over inflation, saying that the risks of either recession, and inflation were now equal.
The vote to reduce the fed funds rate was not unanimous, as Kansas City Federal Reserve Bank President Thomas Hoenig dissented, as he preferred to keep borrowing costs steady. Prices for U.S. interest rate futures contracts showed dealers are scaling back bets on further rate cuts on the back of the Fed’s announcement, implying a 50% chance the FOMC will lower rates again in December, that down from 64% from yesterday.
Here is a Bloomberg video clip with further analysis as the interest rate cut happened today:
For details about a loan and interest rates as they affect your Santa Clarita home purchase, please get in touch with Scott Yonehiro, you can visit his Santa Clarita and San Fernando Valley Mortgage website here.
Remember…when buying or selling Santa Clarita real estate, call me 1st.
Robert Mickalson, Realtor
Vintage Sotheby’s International Realty
661.219.2260 or 661.373.2374
Search the Santa Clarita MLS like a pro @ www.TheScvAgent.com
Search the UP-To-Date Santa Clarita Tract Directory! Go to www.TractDirectory.com
Email It!
