Powell Acknowledges Putting Pressure On Housing While Teeing Up Rate Cut

By KIMBERLEY HAAS The chair of the Federal Reserve acknowledges that their tightening policies to bring down inflation have affected the housing market, and he is offering a glimmer of hope for analysts who expect a rate cut within the next few months. Jerome Powell testified before the Senate Banking, Housing and Urban Affairs Committee on Tuesday where he talked about the Fed’s semiannual Monetary Policy Report, which details the state of the U.S. economy. Powell was peppered with housing questions by Sen. Jon Tester, a Democrat from Montana. “Regardless of where I go in the state of Montana, housing is a big issue,” Tester said. “Larger towns, the medium-sized towns, to small towns, housing is a huge issue. And…

Federal Reserve Not Budging On Rates Yet

By PATRICK LAVERY For the seventh straight meeting, dating back to last September 20, the Federal Open Market Committee on Wednesday voted to maintain the target range for its federal funds rate at 5.25% to 5.5%. That officially means, as experts and prediction tools had almost unanimously agreed going into the week, that the earliest there will be a change to the key rate is after the next FOMC summit on the final two days of July, one year since the last quarter-point increase, and there is skepticism anything will happen then either. In a public statement released after the vote was taken, the FOMC was perhaps not as pessimistic as in the past that the rate might in fact…

Feds Hold Steady On Rates, No Hints On When Cuts May Occur

By PATRICK LAVERY Predicted by both the experts and projection tools alike, the Federal Open Market Committee on Wednesday decided to maintain its target range for the federal funds rate at 5.25% to 5.5%, the sixth consecutive meeting at which the key rate has gone unchanged following a year and a half’s worth of increases. In prepared remarks, Federal Reserve Chair Jerome Powell echoed previous statements over the past eight months in which he indicated that inflation continues to move too slowly, at least for the Fed’s liking, toward its ultimate goal of 2% to warrant any shift – although according to the data Powell provided, that may be more within reach than previously thought. Total Personal Consumption Expenditures prices…

Rate Watchers To Keep Close Eye On The Fed

By PATRICK LAVERY After a swift acceleration of more than five percentage points in about a year and a half, starting in early 2022, could the Federal Reserve Board keep its policy interest rate in a holding pattern for close to a year? That appears likely, as with no change since last summer, most experts feel the Fed is poised to keep the key rate steady – at a range of 5.25% to 5.5% – when the Federal Open Market Committee emerges from its next two-day summit on Wednesday. CME Group’s FedWatch tool has been a valuable resource for Fed meeting predictions in recent months, and once again, its degree of confidence that the Fed will stand pat this week…

Projections For Monetary Policy Show No Rate Changes

By PATRICK LAVERY Americans were just putting away their families’ Halloween costumes the last time the Federal Reserve Board made an announcement on monetary policy, holding the federal funds rate at a range of 5.25% to 5.5%. Now the nation is well past Thanksgiving and fully focusing on the holiday season and the new year ahead. But even as the seasons change, most experts expect the Fed to once again refrain from taking any action at this week’s Federal Open Market Committee meeting, slowing a trend of 11 rate hikes since early 2022. The CME Group’s FedWatch, a forecast of interest rates based on Fed funds futures trading indicators, currently hedges a 98.4% chance that the FOMC will vote to…

Fed’s Policies Take Center Stage At MBA Convention In Philadelphia

By KIMBERLEY HAAS The president and CEO of the Federal Reserve Bank of Philadelphia knew he was facing a tough crowd when he took the stage during a Monday morning session at the Mortgage Bankers Association’s annual convention and expo. “I stand here this morning fully aware of the mood in this room and I am also fully aware of the way the actions we on the FOMC have taken over the past 18 months in our efforts to tame inflation to get it back to a 2% annual target have, in their own way, contributed to the current mortgage climate,” Patrick Harker said. Harker said he met with community members this summer to see firsthand the impacts that monetary…