October Interest Rate Update

Interest rates continue to be the hot topic as the Fed is full steam ahead with its plan to tame levels of inflation we haven’t seen since the early 1980s. 2022 has already seen the Fed raise the Federal Funds Rate 5 times. Since the first hike on March 17th—a +25 basis point increase from 0.25%-0.50%—the fed has kept the pressure on bringing the rate up to 3.25% on September 21. Despite growing concern that the aggressive plan might drive the U.S. economy into a recession, in juxtaposition to the desired soft landing, the Fed is expected to increase rates once again when they meet next week. That projected increase could be +75 basis points for the fourth consecutive time this year, bringing the rate to 4.0%.

October has seen the U.S. 10-Year Treasury (US10Y) increase steadily from a low of 3.56% early in the month to a high of 4.22% on Friday, October 21. Since that peak last Friday the US10Y has dropped down to 3.93% at the close of the market today, continuing its decline for the week.

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