Keller WIlliams Luxury Logo
Home » Fed Weighs Options as Europe Cuts Rates

Fed Weighs Options as Europe Cuts Rates

by | Dec 10, 2008 | Hawaii Real Estate | 0 comments

The U.S. Federal Reserve Board is scheduled to meet in mid-December, and officials are looking at unconventional methods to spur a rebound in the U.S. economy.

European and other central banks continue to use interest rate cuts to head off recession, but the U.S. interest rate is already at a low.

The Bank of England and Sweden’s central bank reduced interest rates to 2 percent, and the European Central Bank cut rates to 2.5 percent.

In the United States, the rate is already at 1 percent, though it could be reduced further at the mid-December meeting.

Other options include cutting interest rates on mortgages, consumer borrowing, or Treasury bonds. The gap between Treasurys and other debt raises concerns among Fed officials, which is why the agency launched programs to narrow those spreads.

“Such programs are promising because they sidestep banks and primary dealers to provide liquidity directly to borrowers or investors in key credit markets,” Fed Chair Ben Bernanke said.

Meanwhile, the Fed could purchase Treasury bonds to drive down yields, but many experts do not see that as a viable option.

Bernanke has called upon lawmakers to aggressively aid home owners to help them avoid foreclosure.

Source: Wall Street Journal, Joellen Perry, Job Hilsenrath

Recent Posts

May Sales Statistics for the Big Island Resort Areas

May Sales Statistics for the Big Island Resort Areas

Apart from condominium sales in Mauna Lani and Waikoloa Beach resorts, real estate activity along the Kona-Kohala Coast was light. Mauna Lani Resort led the market with six condominium sales, followed by three in Waikoloa Beach Resort and one in Mauna Kea Resort....

read more
The Leverage Is Yours, For Now.

The Leverage Is Yours, For Now.

By Dan Polimino The slow season in Hawai`i is May 1 through November 1. There is usually is a little bit of an uptick in activity in the summer months of June, July and August based on summer vacation travel. But, for the most part tourism is down, sales transactions...

read more
April Sales Statistics for the Kohala Coast

April Sales Statistics for the Kohala Coast

Condominium sales picked up in April with eight units closing in Mauna Lani Resort, followed by five closings in Waikoloa Beach Resort and two in Hualālai Resort. Home sales were led by Mauna Kea Resort with two closings, followed by single home sale closures in...

read more

Recent Listings

Call Now