Watch FOMC Rewind: Here’s what the Fed’s November Decision Means for You

November 18, 2020

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!

You may also be interested in:

The views expressed here do not necessarily reflect the views of the management of the Federal Reserve Bank of San Francisco or of the Board of Governors of the Federal Reserve System.