This has been discussed for several years, could this be the absolute best time to buy or refinance?
The Federal Reserve on Wednesday moved to the verge of raising interest rates for the first time since the economy fell into recession more than seven years ago, even as officials suggested that the Fed might not pull the trigger until well into the second half of the year.
In a statement released after a two-day meeting of its policy-making committee, the Fed said that it would consider raising its benchmark rate as early as June, and it removed from the statement a promise that it would be “patient.”
Yet the Fed tempered that message on Wednesday, including the release of economic forecasts by its senior officials that showed they now think the unemployment rate can still fall significantly without setting off higher inflation. That conveyed an impression that Fed officials may feel less urgency about raising interest rates so soon.
“Just because we removed the word ‘patient’ from the statement doesn’t mean we’re going to be impatient,” Janet L. Yellen, the Fed’s chairwoman, said at a news conference after the statement’s release. Ms. Yellen said the Fed was not declaring an intention to raise rates in June, “although we can’t rule that out.”
Her remarks suggested that borrowers have a few more months to take advantage of exceptionally low interest rates on mortgages and car loans, while savers face a few more months of exceptionally meager returns on their low-risk investments. And even after the Fed raises its crucial interest rate, borrowing costs may well remain comparatively low well into the future.
Investors celebrated like the recipients of a last-minute reprieve.
The Standard & Poor’s 500-stock index rose 1.2 percent to close at 2,099.50. Bond prices also jumped, driving the yield on the benchmark 10-year Treasury bond to its largest one-day decline since October. The yield fell 0.13 points to 1.92 percent.
Evan A. Schnidman, chief executive of Prattle Analytics, which analyzes central bank communications, said the Fed surprised many investors because the public remarks of Fed officials over the last year have consistently pointed to an earlier start date for rate increases than the Fed’s official statements.