Odds At 100% (Certain) The U.S. Prime Rate Will Rise To 3.50% After The March 16, 2022 FOMC Monetary Policy Meeting

Prime Rate Prediction

Prime Rate Forecast

As of right now, our odds are at 100% (certain) the Federal Open Market Committee (FOMC) will vote to raise the target range for the benchmark fed funds rate, from the current 0.00% - 0.25%, to 0.25% - 0.50%, at the March 16^TH, 2022 monetary policy meeting, with a concurrent bump up for the United States Prime Rate (a.k.a Fed Prime Rate) to 3.50%.

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Housing

The Commerce Department released New Home Sales figures today. The record-high median price on a newly built home has been updated to $421,500, set back in October 2021. The record-high average price, also from October, was updated to $486,600.

As for preowned homes, The record-high prices remain at $362,800 (median; June 2021) and $381,200 (average; June 2021.)

Inflation

 

The December 2021 Consumer Price Index reading was +7.036% year-on-year, an alarming surge in prices which virtually guarantees that the Fed will raise rates at least once this year, and most likely by 25 basis points (0.25 percentage point) at the March 16, 2022 FOMC meeting.

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Coronavirus Pandemic: Please Keep Your Distance!

 

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>> http://bit.ly/COVID-Pandemic <<

 

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The current U.S. Prime Rate was lowered from 4.25% to the current 3.25% on March 15^TH, 2020.

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Coronavirus COVID-19 Reminder:

Symptoms of COVID-19, which may appear 2-14 days after exposure, include:

• Fever
• Cough
• Shortness of breath

Emergency warning signs for COVID-19 include:

• Difficulty breathing or shortness of breath
• Persistent pain or pressure in the chest
• New confusion or inability to arouse
• Bluish lips or face

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-- What To Do If You Are Sick (PDF) --

-- Novel COVID-19 Coronavirus UPDATES --

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NB: U.S. Prime Rate = (The Fed Funds Target Rate + 3)

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Stay tuned for the latest odds, and for current U.S. economic data (inflation, jobs, economic growth, wages, etc.) 

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Current Odds

• Current odds the United States Prime Rate will rise to 3.50% after the March 16^TH, 2022 FOMC monetary policy meeting: 100% (certain.)
  
  

• NB: United States Prime Rate = (The Fed Funds Target Rate + 3)

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First FOMC Meeting of 2022 Adjourned: United States Prime Rate Continues At 3.25%

United States Prime Rate

The Federal Open Market Committee (FOMC) of the Federal Reserve System has just adjourned its first monetary policy meeting of 2022 and, in accordance with our latest forecast, has voted to maintain the benchmark target range for the federal funds rate at 0% - 0.25%. Therefore, the United States Prime Rate (a.k.a the Fed Prime Rate) remains at 3.25%.

NB: U.S. Prime Rate = (The Fed Funds Target Rate + 3)

Here's a clip from today's FOMC press release (note text in bold):

"...Indicators of economic activity and employment have continued to strengthen. The sectors most adversely affected by the pandemic have improved in recent months but are being affected by the recent sharp rise in COVID-19 cases. Job gains have been solid in recent months, and the unemployment rate has declined substantially. Supply and demand imbalances related to the pandemic and the reopening of the  economy have continued to contribute to elevated levels of inflation. Overall financial conditions remain accommodative, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses.

The path of the economy continues to depend on the course of the virus. Progress on vaccinations and an easing of supply constraints are expected to support continued gains in economic activity and employment as well as a reduction in inflation. Risks to the economic outlook remain, including from new variants of the virus.

The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. In support of these goals, the Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent. With inflation well above 2 percent and a strong labor market, the Committee expects it will soon be appropriate to raise the target range for the federal funds rate. The Committee decided to continue to reduce the monthly pace of its net asset purchases, bringing them to an end in early March. Beginning in February, the Committee will increase its holdings of Treasury securities by at least $20 billion per month and of agency mortgage‑backed securities by at least $10 billion per month. The Federal Reserve's ongoing purchases and holdings of securities will continue to foster smooth market functioning and accommodative financial conditions, thereby supporting the flow of credit to households and businesses.

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Michelle W. Bowman; Lael Brainard; James Bullard; Esther L. George; Patrick Harker; Loretta J. Mester; and Christopher J. Waller. Patrick Harker voted as an alternate member at this meeting..."

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