.comment-link {margin-left:.6em;}

Prime Rate

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

Tuesday, October 24, 2006

Fed Decision On Interest Rates Tomorrow: No Change Expected

Later today, the Federal Open Market Committee (FOMC) will convene the seventh monetary policy meeting of 2006, a meeting which will span 2 days. Tomorrow afternoon, the FOMC will announce their decision on interest rates, and it is fully expected that the group will vote to leave interest rates alone. This means the benchmark Fed Funds Target Rate will remain at 5.25%, and the Wall Street Journal Prime Rate (the U.S. Prime Rate) will remain at the current 8.25%.

The next monetary policy meeting, which will be the last of 2006, will take place on December 12, and as of right now, the vast majority of economists and investors are predicting that the Fed will leave rates alone again after the December meeting.

What is the Fed Funds Futures market predicting for tomorrow? Right now, the odds are at a mere 2% (according to pricing on contracts) that the FOMC will vote to lower rates by 25 basis points (0.25 percentage point.) In other words, for tomorrow, a move on interest rates is very unlikely.

Stay tuned: we'll have more odds and analysis after the Fed issues a press release following tomorrow's policy meeting, as is their custom.



Post a Comment

Links to this post:

Create a Link

<< Home

Zero Percent Intro APR Balance Transfer Credit Cards

Entire WebLog (Blog) © 2010 American CyberSpace®

This website is not owned by or affiliated with The Wall Street Journal® or Dow Jones & Company.
Information in this website is provided for educational purposes only. The Prime Rate probabilities
and predictions posted in this blog are not financial recommendations or professional advice, and
should not be interpreted as such. The owners of this website make no warranties with respect to any
and all content contained within this website. Consult a financial professional before making important
decisions related to any investment or loan product, including, but not limited to, business loans,
personal loans, education loans, first or second mortgages, credit cards and car loans.