The FOMC (Federal Open Market Committee) or FED concluded its one day meeting on Tuesday where it chose to leave the overnight funds rate (the rate at which banks lend money to each other) at a range of 0.00% to 0.25%, for the fourth straight month.
Key Takeaways From the Fed About Current Conditions
- Labor market / job market conditions have improved
- Household and business spending have improved
- Housing remains depressed
- Inflation has been subdued
- Long term inflation expectations are stable
Key Takeaways From the Fed About Future Conditions
- They are seeking price and employment stability
- They will actively accommodate the market by making changes as they see fit to encourage healthy inflation levels
- They expect to keep the target Fed funds rate at 0.00% to 0.25% through late 2014
From the Fed Press Release:
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects moderate economic growth over coming quarters and consequently anticipates that the unemployment rate will decline gradually toward levels that the Committee judges to be consistent with its dual mandate. Strains in global financial markets have eased, though they continue to pose significant downside risks to the economic outlook. The recent increase in oil and gasoline prices will push up inflation temporarily, but the Committee anticipates that subsequently inflation will run at or below the rate that it judges most consistent with its dual mandate.
To support a stronger economic recovery and to help ensure that inflation, over time, is at the rate most consistent with its dual mandate, the Committee expects to maintain a highly accommodative stance for monetary policy. In particular, the Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions–including low rates of resource utilization and a subdued outlook for inflation over the medium run–are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.
How Did the FOMC Meeting Affect Mortgage Rates? Where Are Rates Now?
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In addition to the most current mortgage rates, we can also help you understand which loan programs best fit your needs and whether or not a rate lock makes sense for your current mortgage needs.