Indeed, since the Fed ended its bond-buying, countervailing factors have actually reduced some borrowing costs, like the average interest rate on 30-year mortgages. “That’s happening with a whimper, but handled differently, it could’ve been a big event.”The Fed, which has raised its benchmark interest rate twice this year, left that rate unchanged Wednesday, but indicated that it plans a third rate increase later this year as economic conditions continue to strengthen. Fed officials once again reduced their expectations for rate increases in coming years. Moreover, Fed officials predicted that the rate would fall to 4.1 percent next year. The Fed wants to use its benchmark rate to manage economic conditions while gradually draining its investment portfolio in the background.

Source: New York Times September 20, 2017 18:08 UTC