Interest rates took a wild ride this month, surging on expectations that the Federal Reserve would taper its bond buying program and the receding when the central bank stood pat. The end result was that September was much kinder to borrowers and savers than August was. Interest paid on popular savings products either rose or remained unchanged at month’s end, while mortgages and other loan products got a bit cheaper since August.
The yield on the benchmark 10-year Treasury note started the month at 2.84% and soared as high as 2.98% before reversing course — thanks to the Fed’s surprise move of making no policy changes. By the end of Sept. the rate had cooled off all the way back down to 2.64%. On a net basis, the interest rate environment broke against lenders and in favor of consumers.
True, money markets — a popular place to stash cash — fell for the sixth straight month despite the action in benchmark Treasurys. The national average interest rate on a money market account slipped to 0.4% as of Sept. 24 from 0.43% a month ago, according to data from Bankrate.com (RATE).
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Source: Investor Place