www.CUNA.org/newsnow (1/11/11) People looking to bolster their savings during the next few years will have to deal with a paucity of interest rate yields, a Credit Union National Association (CUNA) economist told Bankrate.com.
Although no one knows for certain when the Fed will adjust interest rates, one sure thing is that it won't happen until inflation becomes a concern, Bankrate.com said, forecasting that 2011 would be "another year of pain, but no gain".
Unfortunately for savers, 2011 looks to be another year of "Pain but no gain".
Or at least, negligible gain. -- Bankrate.com
As a result, savers may face a prolonged yield drought for the next several years, Mike Schenk, CUNA vice president of economics and statistics, told the publication. "Without those substantial increases in economic activity, without improvements in labor markets, you won't have inflation pressures," Schenk added.
The article advises savers to keep an eye on Treasury security yields to gauge which way the interest rate winds are blowing. "They reflect everything from Fed expectations to how the economy is doing and inflation prospects."