U.S. Bank Deposit and Loan Rates
3.54%. According to the Federal Reserve interest query, the U.S. bank lending benchmark rate of 3.54%, the Federal Reserve Federal benchmark rate is the dominant interest rate in the U.S., the commercial banks will be adjusted accordingly according to the Federal Reserve Federal benchmark rate for their own savings and loan interest rates, the Federal Reserve lending benchmark of 3.54%.
The interest rate on deposits in the US is so low, but the interest rate on loans is almost the same as ours, why?
The result of market economy!
Market economy integration and liberalization, formed are adapted to this market!
1. The Fed controls interest rates.
Yes, the Fed can change its federal funds rate - the overnight lending rate between banks - and changes in those rates affect short-term rates on business loans and consumer loans. But various long-term rates, such as those on 10-year U.S. Treasuries or 30-year mortgages, depend on the capital markets and are affected by inflation trends, government budget deficits, and, over time, the overall demand for and supply of funds.
Recently, when the Fed began its second round of "quantitative easing," its effort to lower long-term interest rates by pumping more money into the U.S. economy, the limits of its influence were revealed. The limitations of its influence were laid bare. Those long-term rates did fall in the weeks leading up to the program's launch in November, but they began to rise sharply again shortly thereafter. The reasons?
First, signs of a strengthening economy have prompted many analysts to raise their expectations for growth this year, which means that the demand for money will increase along with it - and greater demand for money will translate into higher rates. Second, the tax-cut deal reached between the White House and congressional leaders in December will raise the amount of debt the government will raise this year, increasing the demand for money. Finally, some investors are concerned that as the U.S. economy regains momentum, the Federal Reserve's "quantitative easing" program could lead to rising inflation, and this concern could lead to higher interest rates.
2. Low interest rates will continue.
This is not the case. Interest rates will keep going higher, and not just because the Fed will eventually raise short-term rates once the economy accelerates. Our recent research shows that global demand for capital is rising rapidly as emerging markets begin one of the largest construction booms in history. Rapid economic growth and urbanization in developing countries - especially China - is fueling demand for housing, roads, ports, water and power systems, machinery and equipment. By 2030, annual global investment demand could rise to $24 trillion from $11 trillion today.
Meanwhile, global savings are unlikely to rise just as fast because countries around the world will need to spend more on pensions, health care and other needs of their aging populations. By 2030, the gap between global savings and investment needs will be as high as $2.4 trillion, according to some forecasts. And, because the amount of savings and investment must, by definition, equal each other, that funding gap will drive up interest rates.
3. U.S. policymakers should keep interest rates low so that consumers spend more and the U.S. economy grows. U.S. households are saving at a higher rate now than they were during the credit bubble of the recent past; the personal savings rate rose to nearly 6 percent in 2010, up from 2 percent in 2007. Not only does this help people save for retirement, it is also good for the long-term health of the U.S. economy: a higher national savings rate will help raise more money for national investment. If anything needs to change, policymakers should encourage consumers to save more.
However, would more personal savings dampen economic growth? It would not inhibit economic growth if businesses and governments invested more to expand the nation's capacity to produce and deliver more and better products and services. In the past, we have invested too little, especially in infrastructure. The American Society of Civil Engineers estimates that over the next five years, the United States will need to invest an additional $2.2 trillion in transportation, water, energy, schools, waste disposal and public ****parks in addition to our current $400 billion per year to update the nation's outdated and aging infrastructure and to help meet growing demand.
These various types of investments will provide an extra boost to economic growth, offsetting declining gains in consumer spending. Now is the right time to start doing so, even though interest rates are still near historic lows.
4. In order to support the housing market and the U.S. economy, it is necessary to retain the tax deduction for mortgage interest.
It is hardly necessary. The mortgage interest deduction would be welcomed by homeowners, real estate agents and lending institutions, but its broader economic benefits are controversial.
Under current law, U.S. taxpayers can deduct up to $1 million in interest payments on mortgage debt on their first and second homes, and they can deduct up to $100,000 in interest payments on home equity loans. As a result, the law reduces the cost of homeownership and creates an incentive for people to take on additional mortgage debt - real estate and financial sector growth, and increased consumer spending.
But with these gains comes a cost: this interest relief reduces federal revenues (by a projected $104 billion in 2011), thereby increasing the budget deficit. It has also encouraged American households to take on more debt than they would have without the deduction, thereby contributing to the housing market bubble that ultimately led to the financial crisis. In sharp contrast, Canada did not have such home mortgage tax relief and its housing market was healthier and less leveraged, avoiding the ups and downs of the Great American-style boom and bust. President Obama's fiscal commission's recommendation to severely limit mortgage interest deductions is a step in the right direction.
5. Raising interest rates is bad for the U.S. economy.
In fact, in many ways, appropriately higher interest rates would be more favorable to the U.S. economy than the very low rates of recent years. Higher interest rates would benefit savers (especially retirees and pension funds) and therefore encourage households to save more.
Higher interest rates would also limit the creation of financial bubbles and discourage speculative and over-leveraged investments, while encouraging more investments that would actually increase the economy's potential growth rate, such as expanding the nation's broadband network, developing new green technologies, and renovating outdated and aging infrastructure.
Higher interest rates would also cause business executives to focus more on the returns their capital investments are generating for their organizations, with a constant reminder to make sure they're getting more out of every dollar they spend. This would increase the nation's productivity, and increased productivity is the key to continually improving people's standard of living over time.
What does it mean for a loan to have an annual interest rate of 5.6%?
It's the interest rate of 5.6 percent
If you take out a loan of 100,000, 100,000 0.056 = 5,000.6, which is 5,600 dollars a year in interest.
Types of loans: personal credit loans, home mortgages, college student loans, self-employed loans, home mortgages
Bank loans keep in mind five key points:
1, choose the best way to loan
The interest rate of provident fund loans is currently lower than the same period of the interest rate of the commercial loans by about 1 percentage point, so as long as you meet the conditions of the use of public fund loans, you should apply for a public fund as much as possible. The first thing you need to do is to apply for a CPF loan as soon as possible. It is important to note that CPF loans require the borrower to be a contributor to a housing fund in the first place, and individuals without CPF deposits can only apply for commercial loans.
2. See what kind of interest-bearing method the loan is
Normally, both the interest rate on the loan and the management fee will be clearly marked. However, if we just look at how high the numbers are and don't pay attention to the exact way the fees are charged, we may be paying more interest because that way may just seem lower. Let's compare two products on the market, and it turns out that the one that looks like it has a low interest rate is rather more costly. One is from a bank that uses a monthly management fee to accrue interest, which is 0.85% per month. The other was a loan product from a small lender that used a monthly interest rate of 1% per month. Numerically, a monthly interest rate of 1% seems to be higher than a management fee of 0.85%, but after doing some calculations, it turns out that the opposite is true. Calculated on a 12-month loan of $100,000, the product that charges a management fee *** charges a management fee of $10,200 (100,000 x 0.85% x 12 = $10,200). And the total interest calculated by monthly interest is only 6618 yuan (equal principal and interest), 3400 yuan less than the former.
3, according to the income arrangement repayment
Repayment arrangement is mainly to determine the loan period and down payment rate. The vast majority of housing loans are repaid in installments, i.e., equal monthly payments of principal and interest on the loan. For a given house price, choosing a different loan term and down payment rate will determine a different level of average monthly repayment. Usually, the longer the loan term or the higher the down payment rate, the smaller the amount of monthly repayment required, and vice versa. The expected level of monthly income is an objective constraint in determining the repayment arrangement. According to the experience of housing loans in developed countries, an average monthly repayment amount of 15-50% of the monthly income level is appropriate, beyond which the borrower's daily life and consumption level will be adversely affected. In terms of absolute amount, the remaining income of a family after monthly repayment should be at least higher than the per capita minimum living standard set by Beijing. Arranging repayments in accordance with income is the most important point of personal loan considerations.
4, pay attention to prevent the risk of interest rate changes
Housing loan interest rates are floating interest rates, as long as the People's Bank of China to adjust the interest rate, the interest rate that the borrower repaid will change accordingly, the borrower in the housing loan is facing a greater interest rate risk.
5, loan repayment difficulties do not forget to look for the bank
When you are in the borrowing period repayment ability to decline, loan repayment difficulties, do not own hard. You can apply to the bank to extend the borrowing period, the bank investigation is true, and there is no arrears of repayment of loan principal, interest, will accept the application to extend the borrowing period.
: U.S. loan annual interest rate: 4.89 percent
Japanese loan annual interest rate: 1.48 percent