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HomeFed Hikes the Discount Rate….$urprisingly Quick
Posted by Larry Doyle on February 18th, 2010 4:50 PM |
The Federal Reserve indicated on February 10th it was going to raise the discount rate ‘before long.’ Well, in this case, Ben Bernanke is a man of his word as the Fed just raised the discount rate by 25 basis points (.25%) effective tomorrow.
While many market participants had minimized the potential rise in the discount rate as not being significant, I was not and am not in that camp. In fact, the speed with which Bernanke raised the rate after indicating that he would do so ‘before long’ has caught the market by surprise.
What is the immediate market reaction? (more…)
