The Dow Jones industrial average closed at an all-time high Wednesday.
Once again, the Fed announced today what most expected: They will stay the course by shaving off another $10 billion a month in bonds and treasuries purchases, down to $45 billion in total each month. Fed officials have indicated they will continue doing so until something drastic occurs.
The move comes after reports of an overall weak first economic quarter, but in spite of it all, the Dow closed at an all-time high on Wednesday afternoon. Perhaps investors viewed the Fed's decision to continue reducing stimulus efforts as a positive forecast for further market recovery.
Fed officials also reaffirmed their desire to keep interest rates low for the foreseeable future. At the current rate of tapering, however, the bonds and treasuries purchases will be no more by September...unless something happens to stall the slowdown. When the stimulus is over, it's anyone's guess what will happen.
As it stands, mortgage interest rates remain quite low while home values are comparatively high. Due to this combination of factors, many homeowners could obtain a lower mortgage interest rate with a higher loan-to-value ratio. This means a lower monthly payment while continuing to build home equity. If this sounds beneficial to you, feel free to call one our Vertex loan officers to see what you can do at 877-939-0339.
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