The November Federal Open Market Committee meeting statement says the Fed will continue to expand purchases of U.S. Treasury and mortgage-back securities and expects to keep interest rates near zero. What does that mean for you? Let’s rewind.
November 2020 FOMC decision
Transcript
Sean: Hey Remy, what’s up with the Fed?
Remy: They just kept interest rates the same
Sean: Rates are super low now, right?
Remy: Yeah, they’re near 0% to help the economy recover from the pandemic
Sean: How does that help?
Remy: Low rates make it cost less to borrow money so businesses can find money to get back on track and hire more workers
Sean: Rates have been low for a while, right? How long will this last?
Remy: Until there are enough jobs for anyone who wants to work, and until prices start rising a bit faster (like in a healthy economy), and people are confident that’ll continue
Sean: How else can the Fed help?
Remy: They’re also buying a lot of bonds to keep longer-term interest rates—like mortgages—low
Sean: Great, thanks!
Remy: See ya!
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