1. Tuesday, September 24, 2013 - 8:51 AM
I think that theoretically and historically it is growth that will drive the deposit rate higher. But the trigger point of growth for higher rate is unknown currently. Thus my answer is:
Neither at the present time and for the foreseeable future (due to political climate).
My two cents without retribution.
1,462 posts since
Jan 16, 2010
Rep Points: 6,352
2. Tuesday, September 24, 2013 - 9:51 AM
Recently we witnessed that the thought of the Fed tapering their buying moved long-term rates. Nothing fundemental changed about the health of the economy. So current levels seem to be based on the Fed doing some sort of tapering sometime in the next few months. But current rate levels have already priced that in.
For short-term rates it doesn't seem like the Fed will provide any help until late 2015 early 2016. So the only thing that could change is growth. That will need to be sustained growth as most banks still have an excess of deposits and it will take time for that to change.
66 posts since
Nov 18, 2010
Rep Points: 409
3. Tuesday, September 24, 2013 - 10:04 AM
Well it seems like all the bets are on "growth" so low rates seems to be the middle name for those of us depending on CDs. If they really want growth and people to take out more loans, why wouldn't they find a way to tick CD and savings rates even a bit higher? I think savers like myself would spend more and others might take out more loans. At the rate they are going, it is black for a long time with interest rates.
Unfortuntely, from the article and even the posts on this thread, the economic mines are all thinking in the same direction. Not a good one for savers.
1,146 posts since
Aug 10, 2011
Rep Points: 5,113