U.S. stocks strengthened Tuesday as consumer confidence rose to a two-year high and the much-anticipated Federal Reserve meeting kicked off.
The open market committee meeting is expected to lead to the first interest rate hike in four years. An announcement is expected at about 2:15 p.m. Eastern time on Wednesday (June 30).
Interest rates represent a key economic factor for the RV industry, which has been benefiting from the Fed’s decision to keep prime rates low to stimulate the economy. The prime rate, which dictates dealer and consumer loan rates, has been at 4% since June 27, 2003.
The spike in consumer confidence was also good news to the industry, which relies on discretionary spending by consumers.
“Consumers expect the economy to continue to grow at a healthy clip and to continue to generate additional jobs,” said Lynn Franco, head of the Conference Board’s consumer research unit. “With prices at the pump beginning to ease, the short-term outlook remains favorable.”
The Federal Reserve’s open market committee began its two-day meeting Tuesday with the consensus opinion of market watchers that the federal funds interest rate would be raised by a quarter percent to 1.25 percent.