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Saturday, September 18, 2010

Survey show Fed to keep Interest rates low

From Bloomberg


By a 59-4 count, economists expect the Fed to leave unchanged at 0.25 percent the interest rate it pays on banks’ reserve deposits with the central bank.

Home owners with HELOC's and ARMs get another breather, for a while.  Also Fed is planning maintain the current of assets, bascially the Fed is trying to keep interest rates low to spur the economy.
Bernanke, in an Aug. 27 speech in Jackson Hole, Wyoming, said the “preconditions” for higher 2011 growth are “in place.”
At the same time, he outlined the pros and cons of three policy tools to boost growth if the outlook worsens: asset purchases, changes to the low-rate pledge and reducing the rate on reserve deposits. A possible downside of asset purchases is reduced public confidence, “even if unjustified,” in the Fed’s ability to exit from its unprecedented expansion of credit.

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