FED May Reduce Interest Rates in July

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As of yesterday (June 3rd 2019), many traders on Wall Street predict that the FED will reduce the interest rate in the July meeting. According to the Article, there is a 68% chance the reduction will happen. If it does, it will make buying you next home… that much easier as a lower interest rate will reduce your monthly payment.

What is the FED and why do they control interest rates?

FED stands for Federal Reserve. It is the US Central Bank. It is privately run, but by appointed officials from the President of the United States. The seven governors of the FED serve 14-year terms which makes the influence from an elected president watered down.



The FED is responsible for maintaining the monetary policy in the Economy. If they see that inflation is getting too high, then they will vote to raise interest rates which helps keep inflation from getting out of control.

On the flip side, if the Economy appears to be stalling, they may reduce the interest rates which allow us as consumers to borrow money at a cheaper price. It makes buying a house, a car, boat, camper, yeah all those things plus more, cheaper to buy and easier.

If you want to know more about what the FED is doing right now take a look at this article from the New York Times: 

https://www.nytimes.com/2019/06/03/business/fed-interest-rates-wall-street.html

If you want to learn more about the FED and how their decisions affect your life, click on the link below:

https://www.federalreserveeducation.org/about-the-fed/structure-and-functions


Tyson Mollotte Broker @ Coldwell Banker Tomlinson R&H (509) 346-8929


Comments

  1. AnonymousJune 4, 2019 at 2:39 PM

    Love it! Well done. Keep the content coming my friend.

    ReplyDelete

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