Prime Rate Raising to 3.50%

On the heels of today’s .25% rate increase in the Fed Funds Rate, banks are moving their Prime Rates with a corresponding increase to 3.50%. These changes will most likely be effective tomorrow, December 17, 2015.

Wells Fargo was the first to move. We are monitoring the actions of many other banks. Based upon historical precedence we expect all other banks to follow suit.

(Update as of 4:30pm Eastern)
Banks announcing increase to 3.50% Prime Rate effective December 17, 2015:

Wells Fargo
PNC Bank
Chase
Citibank (base rate)
Bank of America

Fed Raises Interest Rates

The Federal Reserve raised the Fed Funds Rate at the conclusion of their FOMC meeting. The rate is now in a target range of 0.25% to 0.50%, moving up basically .25%.

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Release Date: December 16, 2015

For immediate release

Information received since the Federal Open Market Committee met in October suggests that economic activity has been expanding at a moderate pace. Household spending and business fixed investment have been increasing at solid rates in recent months, and the housing sector has improved further; however, net exports have been soft. A range of recent labor market indicators, including ongoing job gains and declining unemployment, shows further improvement and confirms that underutilization of labor resources has diminished appreciably since early this year. Inflation has continued to run below the Committee’s 2 percent longer-run objective, partly reflecting declines in energy prices and in prices of non-energy imports. Market-based measures of inflation compensation remain low; some survey-based measures of longer-term inflation expectations have edged down.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee currently expects that, with gradual adjustments in the stance of monetary policy, economic activity will continue to expand at a moderate pace and labor market indicators will continue to strengthen. Overall, taking into account domestic and international developments, the Committee sees the risks to the outlook for both economic activity and the labor market as balanced. Inflation is expected to rise to 2 percent over the medium term as the transitory effects of declines in energy and import prices dissipate and the labor market strengthens further. The Committee continues to monitor inflation developments closely.

The Committee judges that there has been considerable improvement in labor market conditions this year, and it […]

Fed Funds Rate Unchanged – Year End Rate Hike?

The Federal Reserve kept the Fed Funds Rate unchanged at the conclusion of today’s FOMC meeting. The rate remains in a target range of 0.00% to 0.25%. Chairwoman Yellen says most FOMC members see target for Fed Funds Rate rising by end of year.

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Release Date: September 17, 2015

For immediate release
Information received since the Federal Open Market Committee met in July suggests that economic activity is expanding at a moderate pace. Household spending and business fixed investment have been increasing moderately, and the housing sector has improved further; however, net exports have been soft. The labor market continued to improve, with solid job gains and declining unemployment. On balance, labor market indicators show that underutilization of labor resources has diminished since early this year. Inflation has continued to run below the Committee’s longer-run objective, partly reflecting declines in energy prices and in prices of non-energy imports. Market-based measures of inflation compensation moved lower; survey-based measures of longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term. Nonetheless, the Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators continuing to move toward levels the Committee judges consistent with its dual mandate. The Committee continues to see the risks to the outlook for economic activity and the labor market as nearly balanced but is monitoring developments abroad. Inflation is anticipated to remain near its recent low level in the near term but the Committee expects inflation to rise gradually toward 2 percent […]

September Interest Rate Update – One Year Treasury at 5 Year High

The 1 Year Constant Maturing Treasury (CMT) for August was 0.38%, a five year high not seen since early 2010. Many older Adjustable Rate Mortgages (ARMs) are tied to this rate.

The recent 12 Month Treasury Average (12 MTA or 12 MAT) comes in at 0.221%, the highest in 4 years.

The 11th District Cost of Funds Index (COFI) is reported as 0.643% for the month of July.

Other rates:

Interest Rates - LIBOR, 1 Year Treasury Rate, Prime Rate

See:

http://www.moneycafe.com/personal-finance/cmt-rate-1-year-constant-maturity-treasury/

http://www.moneycafe.com/personal-finance/12mta-and-12mat-12-month-treasury-average/

http://www.moneycafe.com/personal-finance/cofi-rate-cost-of-funds-index/

Fed Funds Rate Unchanged

The Federal Reserve kept the Fed Funds Rate unchanged at the conclusion of today’s FOMC meeting. The rate remains in a target range of 0.00% to 0.25%.

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Release Date: July 29, 2015

For immediate release
Information received since the Federal Open Market Committee met in June indicates that economic activity has been expanding moderately in recent months. Growth in household spending has been moderate and the housing sector has shown additional improvement; however, business fixed investment and net exports stayed soft. The labor market continued to improve, with solid job gains and declining unemployment. On balance, a range of labor market indicators suggests that underutilization of labor resources has diminished since early this year. Inflation continued to run below the Committee’s longer-run objective, partly reflecting earlier declines in energy prices and decreasing prices of non-energy imports. Market-based measures of inflation compensation remain low; survey‑based measures of longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators continuing to move toward levels the Committee judges consistent with its dual mandate. The Committee continues to see the risks to the outlook for economic activity and the labor market as nearly balanced. Inflation is anticipated to remain near its recent low level in the near term, but the Committee expects inflation to rise gradually toward 2 percent over the medium term as the labor market improves further and the transitory effects of earlier declines in energy and import prices dissipate. The Committee continues to monitor inflation developments closely.

To support continued progress toward maximum employment and price stability, the Committee today […]