The Federal Reserve meets this week to decide whether to raise the target rate from the current 2% level or leave rates where they are for now. Traditionally, any change in the Fed's target rate causes an immediate change in the prime rate, which impacts most commercial and consumer debt.
Most economists feel there will be no changes at this point as the Fed balances inflation concerns with economic stimulus and the need to strengthen the dollar. At this point the stimulus pressures are winning out, leading the Fed to keep rates where they are for now. But there is a lot of pressure to increase rates as well, so look for some rate increase by the end of the year and maybe sooner than later.
(Brian Andrews is a certified mortgage banker specializing in the financing of commercial real estate. His business is Andrews Commercial Mortgage and he can be reached at brian.andrews@acmla.com.)
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