Federal Reserve Board Chairman Alan Greenspan told Congress today (July 18) that he believes the U.S. economy still is weak, suggesting the Fed might lower interest rates again.
The Fed’s next regularly scheduled meeting is Aug. 21.
Greenspan told the House Financial Services Committee today that “we are not free of the risk that economic weakness will be greater than currently anticipated and require further policy response.”
The Fed has cut short-term interest rates six times this year, lowering the benchmark prime rate to 6.75%, the lowest level it has been since the spring of 1994.
The lower prime has helped RV dealer profits because it has sharply reduced their inventory finance costs.
However, longer-term interest rates, including rate on loans to retail buyers of RVs, have not come down as dramatically as short-term rates, so the retail market for RVs remains in the doldrums, according to industry sources.