Blog


Federal Reserve Aims to Keep Inflation Low

 

In an attempt to boost the economy as it rebounds from the Coronavirus crisis, the Federal Reserve announced that it aims to keep inflation low for an extended period of time.  So what does that mean? Basically, the cost to borrow money should remain extremely cheap.  Low inflation equals lower mortgage rates.  Mortgage rates are expected to stay near record lows, with the idea of future rate hikes pushed further down the road.  Greg McBride, Chief Financial Officer for Bankrate, echoed that sentiment, “From an interest rate standpoint, this means lower for longer, and lower more often.”

In addition to low mortgage rates, low inflation will also have a positive effect on variable rates tied to credit cards and Home Equity Lines of Credit (HELOCs).  According to Bankrate.com, the average credit card rates are now at a low of 16.03%, with the average rate for HELOCs 4.79%.  Overall, the goal of keeping inflation low is to encourage the public to spend more and support the economy. 

Sources: https://cnb.cx/2Z3ywif

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.