Will short-term interest rates rise at the Fed meeting in December? How will bond investors react?
The U.S. Treasury holds weekly T-bill auctions. That’s not news, but in the 4 weekly auctions held before the Oct. 19 auctions, the 1-month T-bill was priced to yield 0.00%.
Will the Fed raise its targeted federal funds rate in September? The world will know after it meets in mid-September. Is it time to put away the punch bowl?
The yield curve could actually flatten, with longer term bonds benefiting from the tightening with price increases.
Since December 2008, interest rates set by the central bank have been virtually zero, leading to low CD rates and even lower savings account and money market account rates.
Last week’s meeting of the Fed was generally interpreted as bullish on the economy and bolstered confidence that an interest rate increase could indeed come this year.
The Fed is likely to modify the phrasing of its policy statement to signal that an increase in the targeted federal funds rate is not a “considerable time” off in the future.
Fed Chair Yellen discusses weakness remaining in the job market and how it affects interest rates.
CD rates are still at historical lows all over the country, but some cities enjoy higher rates than others.
It may not be a “recovery summer” but the Federal Reserve’s Beige Book shows broad but measured growth across many industries and areas of the country.