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BUSINESS
May 1, 2013 | By Jim Puzzanghera
WASHINGTON -- Federal Reserve policymakers said Wednesday they would continue their stimulus efforts and hold steady on rock-bottom interest rates, but announced no new actions as the economy appeared headed for another spring slowdown. After a two-day policy meeting, the Federal Open Market Committee voted 11-1 to continue its so-called quantitative easing program of purchasing $85 billion of Treasury and mortgage-backed securities each month. However, for the first time since starting the program last fall, the Fed's said in its policy statement that the central bank was prepared to "increase or reduce" the pace of its purchases.
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BUSINESS
April 25, 2014 | By Tim Logan
Fewer home sales and rising interest rates have led to the nation's lowest level of mortgage lending in 14 years. Just $235 billion in home loans were started in the first three months of the year, the lowest figure recorded in a quarter since 2000, according to data from trade publication Inside Mortgage Finance. That's down nearly a quarter from the end of 2013 and more than half from the same period last year, when the housing market was heating up, especially in Southern California.
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BUSINESS
June 7, 2012 | By Tiffany Hsu
China will cut a major interest rate on Thursday for the first time since 2008 as the Asian superpower works to shield itself from the European debt crisis, market fluctuations and its own slowing growth. The benchmark one-year lending rate will fall to 6.31% from 6.56%; interest rates had been unchanged since they were increased last July.  The move to make borrowing costs cheaper, announced by the People's Bank of China on its website (link in Chinese), will become effective Friday.
BUSINESS
April 22, 2014 | By Jim Puzzanghera, This post has been corrected. See the note below for details.
The Federal Reserve's low interest rate policies, designed to stimulate the economy, have cost savers about $758 billion since the end of the Great Recession, according to a study released Tuesday. Inflation and low returns on deposits have led bank customers to lose more than $100 billion in purchasing power in each of the last five years, said MoneyRates.com, which provides consumers with information about bank rates, investing and personal finance. The Fed's benchmark short-term rate has been near zero since late 2008 as central bank policymakers tried to battle the financial crisis and Great Recession.
BUSINESS
May 2, 2013 | By Jim Puzzanghera
WASHINGTON -- The European Central Bank on Thursday lowered its key interest rate to a record low level in an effort to spur economic growth in the recession-plagued Eurozone. The central bank's policymakers lowered its main refinancing rate by 0.25 percentage points to 0.50%, the lowest level ever for the 17-nation Eurozone. The rate is now close to the zero-to-0.25% rate the Federal Reserve Bank has had for its key short-term rate since late 2008. Fed policymakers said Wednesday that they could boost their bond-buying stimulus efforts if the U.S. economy needs an additional boost amid signs of another spring slowdown.
BUSINESS
February 17, 2014 | By Jim Puzzanghera
British authorities on Monday charged three former Barclays Bank employees with fraud for allegedly rigging a key interest rate in the run-up to the financial crisis. The country's Serious Fraud Office said it filed criminal charges against Peter Charles Johnson, Jonathan James Matthew and Stylianos Contogoulas in connection with the manipulation of the London interbank offered rate, known as Libor. The office, which investigates and prosecutes complex fraud cases, said the violations took place between June 2005 and August 2007.
BUSINESS
May 31, 2013 | By Andrew Tangel, Los Angeles Times
NEW YORK - A sudden jump in interest rates is casting a shadow over the stock market. Stocks fell sharply Friday as a persistent rise in rates over the last month threatened to derail the powerful rally this year in share prices. Despite notching its seventh consecutive monthly gain Friday, the Dow Jones industrial average fell more than 200 points on the last day of May as Wall Street grew increasingly alarmed at the upward trend in rates. The yield on the 10-year Treasury note climbed to 2.13% on Friday from 1.63% on May 2. Though yields remain low by historical standards, that's a big jump for a single month and pushed rates up to a level not seen in more than a year.
BUSINESS
August 21, 2013 | By Jim Puzzanghera
WASHINGTON -- The Federal Reserve could start reducing its bond-buying program next month, but won't raise its near-zero short-term interest rate until at least 2016 -- a year later than current central bank projections suggest, Pimco Chief Executive Mohamed El-Erian said Wednesday. Speaking at a Washington panel on the economy, El-Erian predicted that policymakers would try to make more use of the Fed's forward guidance to try to offset the recent rise in long-term interest rates.  Those rates have risen because investors have been anticipating the central bank decision to start tapering its $85 billion in monthly bond purchases.
BUSINESS
May 13, 2013 | By Jim Puzzanghera
WASHINGTON -- The European Central Bank could reduce the interest rate it pays on excess bank deposits to below zero to boost growth in the recession-plagued region, a top official said. The comments over the weekend by Italian Central Bank chief Ignazio Visco, a member of the ECB's policymaking governing council, suggest bolder moves could be coming to shake the Eurozone out of its economic problems. "We are technically prepared to go in that direction," Visco told CNBC of a negative interest rate on bank deposits as he and central bankers and finance ministers gathered in Britain for Group of Seven meetings.
BUSINESS
February 18, 2010 | By Walter Hamilton
The Federal Reserve took its most notable step so far toward unwinding some of the extraordinary measures it took to prop up the economy during the financial crisis. The central bank Thursday raised the interest rate that banks pay to borrow money during emergencies. The hike in the so-called discount rate to 0.75% from 0.5% was widely expected and does not foreshadow an immediate rise in consumer loan rates. The central bank went out of its way to stress that it expected the federal funds rate, which influences credit card and other consumer loan rates, to remain "exceptionally low" for "an extended period."
BUSINESS
April 9, 2014 | By Don Lee
WASHINGTON - An account of the Federal Reserve's last meeting suggests that policymakers aren't as eager to take away the punch bowl as the market thought. The minutes of the March 18-19 meeting state that Fed officials worried that their individual projections for when the central bank would start raising interest rates "could be misconstrued" as indicating a shift by the Fed committee to tighter monetary policy. The average projections released after the March meeting showed a slight move forward in the anticipated timing of a Fed rate increase, and Fed Chairwoman Janet L. Yellen herself gave the impression in a news conference that day that a rate hike could be made by mid-2015, earlier than what the market had been expecting.
BUSINESS
March 19, 2014 | By Jim Puzzanghera
WASHINGTON -- Federal Reserve policymakers voted Wednesday to continue reducing their bond-buying stimulus program and said they no longer would consider raising its near-zero interest rate once the unemployment rate fell below 6.5%. The Federal Open Market Committee voted 8-1 to cut its monthly bond purchases to $55 billion, staying on pace to end the controversial program by the end of the year. The economy grew slower this winter, but that was partly because of bad weather. Still, Fed officials downgraded their growth projections.
BUSINESS
March 19, 2014 | By Jim Puzzanghera
WASHINGTON -- Janet L. Yellen, who broke the Federal Reserve's glass ceiling, marks two more milestones Wednesday, wrapping up her initial policymaking meeting as chairwoman then facing reporters' questions for the first time since taking office last month. The Fed chair's quarterly news conferences have drawn great attention since her predecessor, Ben S. Bernanke, began holding them in 2011 to improve public understanding of the central bank's actions. Now Yellen takes over the tradition, which adds an additional challenge to the job as financial markets try to interpret every answer for signs of the Fed's direction.
BUSINESS
February 17, 2014 | By Jim Puzzanghera
British authorities on Monday charged three former Barclays Bank employees with fraud for allegedly rigging a key interest rate in the run-up to the financial crisis. The country's Serious Fraud Office said it filed criminal charges against Peter Charles Johnson, Jonathan James Matthew and Stylianos Contogoulas in connection with the manipulation of the London interbank offered rate, known as Libor. The office, which investigates and prosecutes complex fraud cases, said the violations took place between June 2005 and August 2007.
BUSINESS
February 9, 2014 | Liz Weston, Money Talk
Dear Liz: My wife of 34 years died five years ago. Her father is 94. He has accumulated a large amount of wealth over the last 40 years. I always made a point of staying out of financial discussions between my father-in-law and his daughters. He told us for years that upon his death all his wealth is to be divided between us (my wife and me) and her sister. Recently, a gold digger reappeared on the scene. My father-in-law and his late wife took her in at a young age when her parents died.
BUSINESS
January 12, 2014 | Liz Weston, Money Talk
Dear Liz: Lately I have been reading a lot about how people aren't saving enough for retirement. Every article I read talks about the need to put enough into employers' 401(k) programs to get the maximum possible company match. What do you do when your employer doesn't match your contribution? Answer: You contribute anyway, and start looking for a better job. The advice that people should contribute at least enough to get the maximum match is designed to ensure that workers don't leave free money on the table.
BUSINESS
April 3, 2013 | By E. Scott Reckard
The interest rate for a key type of student loan is scheduled to double from 3.4% to 6.8% in three months unless Congress, which voted to lower the rate in 2007, decides to keep it in place. The rate for the subsidized Stafford loans had gradually declined from 2008 through 2011, when it bottomed out at 3.4%. Last summer, after some bitter partisan sniping, Congress extended the low rate - but only for a year. It's scheduled to rise back to 6.8% on July 1 unless Congress acts.
BUSINESS
July 31, 2013 | By Jim Puzzanghera
WASHINGTON -- Federal Reserve policymakers voted Wednesday to hold steady on short-term interest rates and the central bank's bond-buying program, but indicated that they expected economic growth to pick up. Following a two-day meeting, the Federal Open Market Committee offered no additional guidance on when it would start reducing its monthly purchases of $85 billion in bonds.  The lack of significant new language likely meant the Fed is...
BUSINESS
January 5, 2014 | By Kenneth R. Harney
WASHINGTON - Higher mortgage rates for 2014? Count on it. Could this be the year to check out hybrid mortgages, which haven't been popular lately? Maybe. You can count on interest rates going higher because: •The Federal Reserve intends to continue reducing its monthly purchases of mortgage bonds and Treasury securities, which will have the side effect of raising rates. •The national economy finally appears to be picking up steam, based on the latest quarterly data. Higher growth rates in turn will increase demand for available credit and probably nudge rates higher.
BUSINESS
January 2, 2014 | By E. Scott Reckard
The economy is brightening as 2014 arrives - but that could signal higher borrowing costs for homebuyers as the Federal Reserve scales back its efforts to lower interest rates and the chance of higher inflation increases. Lenders were offering 30-year fixed-rate mortgages this week at an average of 4.53%, up from 4.48% last week and the highest since September, Freddie Mac said Thursday in its weekly report . The interest rate for a 15-year fixed loan averaged 3.55%, up from 3.52% last week.
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