The Federal Open Market Committee met this week and voted to leave rates unchanged again. They also noted that the pace of economic and job growth continues to slow. Housing starts are depressed, income growth is modest and commercial real estate is weak. They also noted that the Fed plans to leave the Federal Funds Rate near zero for an extended period of time.
The big announcement was the new plan for $600 billion in a support package for the bond markets. This plan has been widely talked about. The only thing that was unknown was the dollar amount. Initially bond investors were looking for $1 trillion, but then lowered estimates to $500 billion. The actual announcement of $600 billion was more than expected, but the bond market didn't react well initially. Immediately after the announcement, the bond market tanked, but then rebounded to about where it was earlier in the day.
The Fed is hoping this will help keep rates low. The decision is aimed at keeping borrowing costs low for businesses and consumers. The pace and size of the purchases will vary depending on the path of economic recovery.
The Bank of Japan also meet this week and they are expected to launch a new round of bond buying. The Bank of England and the European Bank also will meet this week.
Hopefully this will help the economy to start growing and jobs will increase. As that happens the Fed would cut back on the stimulus plan. If you are thinking about refinancing or buying a home, now is the time as rates are very low and we don't know how much longer that will last.
I want to work in commercial real estate. I am working in Hotel Management at the moment, but think commercial real estate is interesting. Im young enough where a career change is not out of the question. What types of things do employers look for? Is there a high demand for people in commercial real estate.