News for Interest Rates
Feb 19 · 11:05:00 PM · Source: CNN Money
The Fed said late Thursday it is raising its discount rate by a quarter percentage point, or 25 basis points, to 0.75%. The central bank said in a statement it made the move in response to improving financial market conditions.
Ben Bernanke's Fed is taking a small step toward normal policy.
The move is largely symbolic, because banks do little borrowing at the discount window.
The unanimous decision to boost the discount rate also has no effect on the more widely watched federal funds rate, which measures the rate banks charge each other for overnight loans. That rate is expected to remain between 0% and 0.25% for the foreseeable future, given the slack in the labor market and the still fragile state of the economy.
Feb 10 · 11:37:00 AM
Federal Reserve Chairman Ben Bernanke began Wednesday to outline the central bank's strategy, saying the Fed will likely start to tighten credit by boosting the interest rate it pays banks on money they leave at the central bank.
This strategy would raise rates tied to commercial banks' prime rate and affect many consumer loans. Companies and ordinary Americans would pay more to borrow.
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