Wednesday, April 30, 2008

Fed Cuts Rate, Inflation on the Rise

From the Atlanta Journal today,

"The Federal Reserve trimmed short-term interest rates by a quarter of a percentage point Wednesday, the seventh cut in seven months.

But the central bank also signaled that it likely would pause its rate-cutting campaign, which so far has pushed down the federal funds rate to 2 percent from 5.25 percent."

I have been pretty displeased while watching the interest in my savings account decrease each month despite adding additional funds regularly. On the other hand, I plan on buying a house towards the end of this year, and will want interest rates to be as low as possible. When it comes down to it, I think the lower interest rate on the house will benefit me more than a higher interest rate on my savings. I do think the rate has gone low enough though. I am afraid that inflation is going to begin to take its toll.

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