The Federal Reserve Bank lowered their primary interest rate another half percent to one percent. This makes it generally less expensive for banks, businesses, and people to borrow money. There is a lot of existing debt, including credit card debt, out there which is directly tied to this number, so over the past month, interest rate payments on those debts have lowered by one percent as well.
I have two loans from the Small Business Administration which are tied to this rate, so I will see a tiny bit of relief, thankfully. The danger here is that the low rate will cause inflation, and given how much money is currently being injected into the economy at the moment, I’d say that’s an important risk. I’ve heard on the radio that the treasury isn’t actually releasing any more “dollars” out into the economy, which should help offset any risks of inflation.
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