Federal Reserve rate cut could help Rockford-area consumers

As economic concerns over the coronavirus grow, the Federal Reserve takes action to curb the damage.

On Tuesday, the Federal Reserve announced an interest rate cut of half a percentage point, or 50 base points. This was the first cut of this kind since December 2008, which was in the midst of the financial crisis.

Mortgages will decrease by an average of 26 points and deposit accounts will drop by an average of 16.

Tom Walsh, president and CEO of Northwest Bank in Loves Park, says this move could be a big advantage to consumers buying a home.

"So, borrowing for consumers will be cheaper," Walsh said. "As the consumer is two-thirds of the U.S. economy, the Federal Reserve is looking to make sure that consumers keep spending, keep investing, keep making the economy continue to grow."

Other financial experts say this could be a good time for consumers to think about starting an emergency fund.