Traders are now anticipating five Fed rate increases in 2022, down from the six or more that seemed like a certainty just a month ago. The market has decided that, due to the situation in Ukraine, the Fed and the other central banks will move more slowly and cautiously.
In the face of uncertainty
All of this was indicated by Fed Chairman, Jerome Powell, in his recent testimony before House and Senate committees. He noted that he still sees a series of quarter-percentage-point increases coming this year but that the Russia-Ukraine war has produced uncertainty in his outlook.
Powell acknowledged in his statement the “tremendous hardship” the Russian invasion of Ukraine is causing, and he went on to say, “The near-term effects on the US economy – the ongoing war, the sanctions, and of events to come – remain highly uncertain. Making appropriate monetary policy in this environment requires a recognition that the economy evolves in unexpected ways. We will be monitoring the situation closely.”
Mortgage interest rates
The mortgage industry has anticipated and responded to the Fed’s proposed interest rate hikes and we here at A&D Mortgage are prepared to make whatever adjustments are necessary on behalf of our customers. However, it now seems as though the current economic instability could moderate or delay the Fed’s rate hikes, which could prolong a lower interest rate environment for some time.
As always, A&D Mortgage will provide our customers with the best available mortgage financing opportunities as they pursue their dreams of homeownership.
Comments are closed, but trackbacks and pingbacks are open.