The Federal Reserve Board left its target for the federal funds rate at 5.25% at its meeting today, January 31, 2007. This was the fifth consecutive time the board held the rate steady. The Fed's closely watched statement indicated the current economic stability and minimal inflationary pressures justify their decision to hold rates and may be a forecast for a continued holding pattern.
The federal funds rate is an overnight bank lending rate that affects rates on various types of loans such as variable-rate mortgages and credit card rates, among others. The rate may also impact rates on various investment and insurance products offered by life insurance companies.
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