Federal Reserve Announcement

Good Development Today

 

One of the main reasons interest rates have remained low for so long has been the Federal Reserve’s policy of stimulating the economy by purchasing mortgage backed securities each month in the amount of 85 billion dollars.  Rates have popped up a bit recently on evidence that the economy has been slowly improving.  The  Federal Reserve was supposed to announce today a cutback or “tapering” of this mortgage securities buying program.  In a surprise move today the Federal Reserve announced no cutback or tapering of the program due to recent economic reports that still show weakness in the economic recovery.  This surprise announcement could cause interest rates to ease down for a period of time.