How the Fed’s Pullback of Stimulus Could Affect You

Consumers will likely pay more for home loans. Savers may earn a few more dollars on CDs and Treasurys. Banks could profit. Investors may get squeezed.

The Federal Reserve’s move Wednesday to slow its stimulus will ripple through the global economy. But exactly how it will affect people and businesses depends on who you are.

The drop in the Fed’s monthly bond purchases from $85 billion to $75 billion is expected to lead to higher long-term borrowing rates. Which means loan rates could tick up, though no one knows by how much.

The move could also weigh on stock markets from the United States to Asia, even though the early response from investors was surprisingly positive.

Just keep in mind: The impact of the Fed’s action is hard to predict. It will be blunted by these factors…

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