The Federal Reserve just had an emergency meeting and made three big moves that will affect our markets.
1. They dropped the Fed Rate to 0 percent after dropping the rate by .5 percent last week.
2. They are purchasing an additional $500 Billion in treasury bills and $200 Billion in mortgage-backed securities after opening up $1.5 Trillion to purchase treasury bills just last week.
3. They removed the 10 percent reserve requirement on banks set in 2008 after the recession.
Why? Business revenue is down dramatically and drastically. Businesses are closing their doors, laying off employees or putting employees on unpaid leave. This move is to support business survival with short term loans and allow them to make payroll. The yield on the 10-year Treasury was also up last week with the disruptions in the Treasury market, the Fed's are hoping this move will keep rates low. But how low?
Flashback to December 2008 to December 2015 when the Fed Rate was 0 percent.. what were our 30-year interest rates? 3.3 percent to 5.5 percent.. not in the 2's. But could they get there? and how soon? Stay tuned as I send out more regular updates. And give us a call if you want to know what this means to you! Our team is ready to not only keep you informed but get you the best rates. Want to look at your opportunity to lower your rate? Start building wealth through real estate (and get OUT of the stock market) ... or simply buy your first home? Call me today!
Nicole Rueth The Rueth Team of Fairway Independent Mortgage Corporation 750 W Hampden Avenue, Suite 500 Englewood, CO 80110 303-214-6393 www.TheRuethTeam.com