RATES DOWN, FED MEETING MAIN EVENT
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Rates are DOWN?this?week.? Check em' out and then read our 30 second commentary below. Rates are averages / examples for network use only: Pricing as of 3/22/2024 at 11:44 am
RATES DOWN, FED MEETING MAIN EVENT
The rate market was intently focused on Wednesday’s announcement from the Federal Reserve. Many news headlines emphasize the Fed "holding rates steady," but that's not what the bond market was focused on.? Because mortgage rates?are determined by the bond market, that meant they were free to move even though the Fed stood still.
Markets were most interested in the Fed's projections for future rate cuts.? In not so many words, those projections retained the Fed's previous expectation of 3 rate cuts by the end of this year, albeit by a smaller margin than the last round of projections in December.
This was a bit more hopeful than markets expected. As such, bonds improved and mortgage rates fell.??
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Federal Reserve members still see three interest rate cuts in 2024 despite an improving outlook for economic growth.
The Federal Open Market Committee’s March projections?for rate cuts, or the so-called dot plot, shows a median federal funds rate of 4.6% in 2024. With the current fed funds rate in a range of 5.25% to 5.50%, the dot plot implies three cuts of a 0.25 percentage point each.
Fed Chair Jerome Powell said in his news conference Wednesday that the central bank wasn’t completely dismissing the recent inflation reports, though he did say that the January data may have been distorted by seasonal factors.
“I take the two of them together, and I think they haven’t really changed the overall story, which is that of inflation moving down gradually, on a sometimes bumpy road, toward 2%,” Powell said. Rates are down this week which is good news for buyers! We'll keep you informed as things change.? Until next week - Have a great weekend!?
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