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Prime Rate

also known as the Fed, National, U.S. and WSJ Prime Rate

Tuesday, August 13, 2002

The Fed Is Comfortable with The Way Things Are Going, Voting Today To Leave The Fed Funds Rate Alone

It looks like 1.75 is going to be The Fed's favorite number this year, as The FOMC voted once again to keep their target rate at 1.75 percent. Therefore, The Wall Street Journal Prime Rate will also stay at 4.75 percent.

Many economists are predicting that The Fed will eventually lower their target rate this year--believe it or not--so you may want to consider holding off on that major purchase a little while longer. Bottom line: interest rates are currently very good, but they could get even better! The next meeting of the FOMC should take place at the end of next month, so stay tuned: if The Fed decides to drop their target rate, we'll report it right here as soon as the word gets out.

Thanks for reading and happy spending!

Here's a piece of the press release that was issued by The Fed today:

"The Federal Open Market Committee decided today to keep its target for the federal funds rate unchanged at 1 3/4 percent.

The softening in the growth of aggregate demand that emerged this spring has been prolonged in large measure by weakness in financial markets and heightened uncertainty related to problems in corporate reporting and governance.

The current accommodative stance of monetary policy, coupled with still-robust underlying growth in productivity, should be sufficient to foster an improving business climate over time.

Nonetheless, the Committee recognizes that, for the foreseeable future, against the background of its long run goals of price stability and sustainable economic growth and of the information currently available, the risks are weighted mainly toward conditions that may generate economic weakness."



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