Fed signals caution; mortgage rates dip
- Freddie Mac said on April 23 the average U.S. 30-year fixed mortgage rate fell to 6.23%, while Federal Reserve officials and economists kept signaling no near-term rush to cut rates. - The 30-year rate dropped from 6.30% a week earlier and 6.81% a year earlier, as Reuters’ latest poll found 56 of 103 economists expect the Fed unchanged through September. - Oil-shock inflation and record-low consumer sentiment are pushing markets to delay Fed cuts even as home-loan rates ease. (freddiemac.com) (usnews.com 1) (usnews.com 2)
U.S. mortgage rates fell again this week, but the Federal Reserve is still signaling patience on any rate cuts. (freddiemac.com) (federalreserve.gov) Freddie Mac said on April 23 the average 30-year fixed mortgage rate was 6.23%, down from 6.30% a week earlier and 6.81% a year earlier. The 15-year fixed rate fell to 5.58% from 5.65%. (freddiemac.com) The company said 6.23% is the lowest level in the last three spring homebuying seasons, and it linked the decline to stronger purchase applications, more refinance activity and higher pending home sales. (freddiemac.com) The Fed story is moving in the opposite direction. A Reuters poll published April 22 found 56 of 103 economists expect the federal funds rate to stay at 3.50% to 3.75% through the end of September. (usnews.com) That was a sharp shift from late March, when nearly 70% of economists expected at least one cut by September. Reuters said most forecasters now see any cut coming at least six months later than they expected earlier this year. (usnews.com) Federal Reserve Governor Christopher Waller said on April 17 that the conflict with Iran had disrupted Middle East energy production and transport, and that a prolonged disruption could have a lasting effect on inflation and U.S. growth. (federalreserve.gov) Minutes from the Fed’s March 17-18 meeting show why officials are moving carefully. The minutes said crude oil futures rose about 50% during the intermeeting period, and futures markets no longer fully priced a Fed cut until December. (federalreserve.gov) Those same minutes said policymakers saw two risks at once: higher gasoline prices could weaken hiring and household spending, but a longer energy shock could also keep inflation above target. CNBC reported officials said they needed to stay “nimble.” (federalreserve.gov) (cnbc.com) Consumers are already showing strain. The University of Michigan’s final April sentiment index fell to 49.8, down from 53.3 in March, which Reuters described as an all-time low. (usnews.com) So borrowers are getting some relief on mortgage pricing even as the central bank stays on hold. For now, cheaper home loans are coming from bond-market moves, not from any new Fed rate cut. (freddiemac.com) (federalreserve.gov)
