The Federal Open Market Committee meets today and markets will be hanging on their every word. There is virtually no chance that the Fed will change the Fed Funds Rate from its current 5.250% level, so its the Fed's press release that will get all of the attention.
We'll disect the message in tomorrow's blog post.
Important to know: The Fed does not control mortgage rates. At least not directly -- their words can cause mortgage markets to make bets on the future and that can change mortgage rates.
The Fed only directly controls the Fed Funds Rate.
FFR matters to you and me because it is used to calculate Prime Rate, a popular consumer interest rate used for credit cards and home equity lines of credit.
When the Fed holds the FFR at 5.250%, it means that the interest rate on our collective credit card and home equity line debt will remain unchanged, too.
