This BREAKING NEWS Article On The Fed Approves 25 Basis Point Rate Cut But Is Divided In Future Action
BREAKING NEWS On The Fed Approves 25 Basis Point Rate Cut:
- The Federal Reserve Board Announced the central bank will cut interest rates by 25 basis points on Wednesday, September 18th, 2019
- The mortgage markets were not too happy with only a 25 basis point cut in rates
- Lenders were expecting at least a 50 basis point rate cut on Wednesday
- The Fed cut interest rates due to uncertainty in the global markets and future economic outlook
- Future inflation fears was also a factor for Wednesday’s central bank interest rate cut
- Indications of future rate cuts by the central bank were mixed
- During its two-day monetary policy meeting, members of the Federal Reserve Board agreed to take down its benchmark overnight lending rate to a 1.75% to 2.00% range
- This news is released after announcing the FOMC cut rates for the first since the 2007 Real Estate And Banking Collapse
- The Dow Jones Industrial Averages and all other markets dropped after the news announcement
In this BREAKING NEWS Article, we will cover and discuss The Fed Approves 25 Basis Point Rate Cut.
Mortgage Rates Go Higher With The Fed News Release
Normally, when there is news about the Fed lowering interest rates, mortgage rates go lower.
- However, this was not the case after the Fed announcement on Wednesday
- Mortgage rates spiked sharply
- The reason mortgage rates went up is due to the comments in the press announcement
- The decision of the rate cut by the central bank was mixed
- Some members said there may be one more rate cut before the end of the year
- Other members said another rate cut may not happen until next year
The Federal Reserve Board was not sure whether or not the central bank will be cutting rates. This news sent mortgage rates higher.
White House Reaction To The News Of The Feds
President Donald J. Trump wasted no time in voicing his opinion after the Fed news release. President Trump who has a history of criticizing Fed Chairman Jerome Powell for not cutting interest rates enough said Fed Chairman Jay Powell has no guts. On the last rate cut, President Trump called members of the Feds “Boneheads.” President Trump wants the central bank to lower rates to zero or even lower into negative territory. He stated that the Federal Reserve Board is playing with fire and risking the U.S. economy by keeping rates higher than the rest of the world.
Here is a tweet by President Trump:
Divided Future Economic Outlook
Whenever the Federal Reserve Board makes a decision, it is usually unanimous.
- However, on Wednesday’s announcement, the members of the Feds were divided in the future of their policy decisions
- Some said they will have one more rate cut this year
- Others stated no more rate cut this year and possibly a rate cut next year
This sent the Stock Markets lower and mortgage rates higher.
The indecision by members of the Federal Reserve Board comes at an important time for the U.S. economy. Consumer confidence has also affected by the indecision.
Volatility Of Mortgage Markets And Where Are Mortgage Rates Heading
The mortgage markets are very volatile. Mortgage Rates are changing several times daily. The housing markets remain strong. Refinance numbers have been increasing month after month since the beginning of 2019. Until we have more decisive answers by the members of the Federal Reserve Board, the mortgage markets and mortgage rates will remain volatile. This is breaking news and a developing story. Gustan Cho Associates Mortgage News will keep our viewers posted on updates on this developing story.
