Will the FED lower interest rates again Tuesday

April 28, 2008

On Tuesday (and Wednesday) the Federal Reserve Bank, the “Fed” and its policy makers meet to announce/decide whether or not to lower key interest rates and more importantly, offer a glimpse into the future interest rate cut decisions by sharing their views of the US economy.

According to several sources , Most investors believe the Fed will lower rates by another quarter percentage point but will also suggest they are gearing up for a pause.

How does this affect mortgage rates? Fist of all, the rate cut is all but factored into the market. Remember the bond (for the most part) market indicates loan rates. The bond market has moved to reflect this 1/4 % point cut.

However, should the Fed give hints of further cuts, bond market would rally , thus causing interest rates to drop; further helping loan rates.

On the other hand, if the FED ‘minutes’ suggest a pause in cutting rates,the bond market will drop and rates across the board will rise (how much depends on a lot of factors).

Depending on why you are purchasing real estate it is not 100% the case. However, in most situations, how you finance your home, can be significantly more important than the price you pay.

If you are a buyer or seller or a causal observer, take a minute, tune into your local news, read the local papers in Phoenix , Mesa, or Scottsdale or read the front page of Yahoo Finance and see what happen.

Remember, information is power. It always helps you make a more educated, well-informed and prudent decision.

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Copyright © 2008 By James Wexler, All Rights Reserved. *Will the FED lower interest rates again Tuesday*

Contact James Wexler (480) 221-8080 for all your Phoenix Scottsdale area Real Estate needs.

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Written by James Wexler · Filed Under Articles, Buyers, Investing, Lending / mortgages 

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