FED LOWERS PRIME RATE BY 0.5%
On Wednesday the Federal Reserve announced that it would cut the federal funds target rate, and so also the prime rate, by half a point, as widely expected, to 1.00%. The accompanying statement said economic activity has decreased markedly, largely due to a decline in consumer expenditures but also affected by weakening business spending and industrial production.
The Federal funds rate is a key short-term interest rate used to set rates for a wide variety of loans, both consumer and business, including home equity lines and credit cards.
What does this mean to you?
The Fed has lowered this rate to increase the amount of money in the financial system. The impact that will be felt by most consumers immediately is the lowering of consumer credit cost. In the next month you should see a .5% drop in the rate on your HELOC's and your revolving credit cards. This means less interest paid and ideally more money in the economy!
Your friend in real estate,
Shelli Dore
www.ShelliDore.com