Average CD Interest Rates Mostly Lower on FOMC September 21 Statement
In the statement the Committee said "Information received since the Federal Open Market Committee met in August indicates that the pace of recovery in output and employment has slowed in recent months." The Committee also said it will "maintain the target range for the federal funds rate at 0 to 1/4 percent" for an extended period of time.
A slowing economy and a low fed funds rate will keep interest rates low for the foreseeable future. A third fed policy will also keep interest rates low. The fed said it is "prepared to provide additional accommodation if needed to support the economic recovery."
The additional accommodation will come in the form of asset purchases also known as quantitative easing. Late in 2009 and early 2010 the fed drove interest rates lower by buying mortgage backed securities and other financial assets. Another round of quantitative easing will force CD rates, savings rates and mortgage interest rates to new lows.
National Average CD Rates September 27, 2010