The Fed Takes Subprime Woes in Stride

As subprime mortgage troubles aren't sapping the larger economy, the Fed won't drop interest rates, likely holding them at current levels for now

Rising interest rates threaten to force loads of homeowners with subprime mortgages into foreclosure. The Federal Reserve could have relieved the pressure on those homeowners by lowering rates on June 28. But it didn't, leaving the federal funds rate at 5.25%, right where it's been since last summer.

To continue reading this article you must be a Bloomberg Professional Service Subscriber.