Today, the Fed announced it would keep the target Federal Funds rate unchanged at 0.00 to 0.25% and continue to purchase back debt to help ward off a recession. Their plan of action includes buying up to $300 billion in long-term Treasuries over the next few months. Informa Research Services advises consumers on how to make the most of the Fed’s recent decision.
“Prices on U.S. Treasury bonds soared on the news and the yield fells sharply,” according to the Wall Street Journal. “Yields on 10-year treasury notes dropped. Stock prices also rose sharply and the dollar sank” (Source: WSJ.com).
Additionally, the effect of the Fed’s announcement was apparent within hours as a dip in mortgage rates was seen. According to CNBC, Quicken Loans dropped 30-year mortgage rates by as much as 0.375% (Source: CNBC).
However, many speculate that this drop may be temporary. If history is any indication, this dip could easily be undone with rates jumping back up erratically and without warning.
Nobody can know for sure where rates are headed or how long they will stay there. However, checking online rate comparison tables and national averages regularly are easy ways to keep an eye on rate trends.
Because of the unpredictability of the current economic environment, if you have been waiting for a low rate to purchase a home or refinance an existing loan, now may be the time to take advantage of the low rates being offered and secure one before rates bounce back up.