The Federal Reserve has cut its benchmark interest rate from its 23-year high, with consequences for debt, savings, auto loans, mortgages and other forms of borrowing by consumers and businesses.
Federal Reserve cuts interest rates signaling what could be a dramatic shift | What consumers should knowHouston ISD police investigating bomb threat at Bellaire HS; school placed on secure modeGet ready to travel this fall with these Insider Deals“With auto loans, it’s good news that rates will be falling, but it doesn’t change the basic blocking and tackling of things, which is that it’s still really important to shop around and not just accept the rate that a car dealer would offer you at...
More Fed rate cuts are expected in the coming months, with the steepness of the reductions dependent on the direction of inflation and job growth.Although taking action now to try to capitalize on lower rates, like shifting money out of a certificate of deposit or refinancing a mortgage, “might be warranted for some, you shouldn’t feel obligated to completely change up your financial strategy just because rates move lower,” said Jacob Channel, a senior economist at LendingTree.
“Lower interest rates make it harder to maximize savings and preserve the capital built while interest rates have been higher,” said Matt Brannon, a personal finance expert at MarketWatch guides. “An easy short-term move to protect your savings is to shift your funds into a high-yield savings account, which offers higher interest rates than traditional savings accounts... These types of savings accounts will still help you to preserve capital due to comparatively higher interest rates.
“It goes to show that even when the Fed isn’t doing anything and just holding steady, mortgage rates can still move,” he said. Loans for new vehicles right now are averaging 7.1%, with used vehicle loans at a much higher 11.3%, according to
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