Last week, Fed chair Jerome Powell indicated that a slower pace of rate hikes was in the offing, noting that it “makes sense to moderate the pace of our rate increases” as it approaches a level likely to see inflation continue to tick downwards.
November’s consumer price index figure, announced on Tuesday, spurred a rally across the stock and bond markets with inflation having hit its lowest reading since last December and coming in lower than the 7.3% expected by economists.
Still, the Fed indicated in its Wednesday statement that “ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2% over time.”
How the mortgage market has been impacted by rate hikes
The December move is the Fed’s seventh rate hike of 2022, with the central bank having taken aggressive action throughout the year on its benchmark rate to cool the economy and bring inflation, which hit a 40-year high of 9.1% in June, back under control.
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