The Federal Reserve wants to increase the interest rates they
charge to loan to banks. The banks then offer loans to individuals and
corporations at interest rates that are roughly double the federal fund rate.
The current federal funds rate rose to 2.25 percent when the Federal
Open Market Committee met on September 26, 2018. This benchmark rate is an
indicator of the economy's health. The Federal Reserve signaled it would raise
rates to 2.5 percent in
December 2018, 3.0 percent in
2019, and 3.5 percent in
2020.
The average mortgage
interest rates are 4.49% for 30 year loans and 3.92% for 15 year loans.
Current 5 year auto
loans are based on credit scores and range from 4.25% to 7.5%.
Student loan interest
rates are 5.05% for undergraduate and 6.6% for graduate courses.
The increases in
interest rates planned by the Federal Reserve will result in increases in the
interest rates charged for loans to individuals and corporations and adversely
affect the US economic recovery that began in 2017.
The Federal Reserve
reported $4.137 trillion in assets as of 10/24/18. The Fed buys Treasury Bills
that pay 2.825%.
Norb Leahy, Dunwoody
GA Tea Party Leader
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