| With those words, Fed Chair Jerome Powell confirmed that the Fed will cut interest rates at its next policy meeting on September 18th. Although cuts will happen in September, the size and speed will depend on incoming economic data, particularly labor market data. Markets have already priced in aggressive expectations for how quickly the Fed will move. If the Fed ends up cutting slower than anticipated, rates might rise a bit in the fall. | |||||||||||||||||||||||||
| After Powell’s speech, both Wells Fargo and Fannie Mae updated their 30-year fixed mortgage forecasts: | |||||||||||||||||||||||||
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| Our take | |||||||||||||||||||||||||
| Our loyal readers know this news does not come as a shock to us. The question now is: how big will the cut be? 25 basis points or 50? We’re in the 25 bps camp. Now while this is clearly great news, especially for buyers, we do have one word of caution–most of the benefits from these cuts won’t be seen until 2025. As the projections from Wells and Fannie Mae show, that’s when mortgage rates will finally fall below the 6% threshold. |
“The time has come for policy to adjust”
