- The Fed still thinks that its next move will be a rate cut, and Powell clearly said that further rate increases are “unlikely.”
- Still, it is not clear how much the Fed will manage to cut rates this year. Inflation is cooling more slowly than officials had expected.
- Powell avoided commenting on whether three rate cuts are still possible this year: That was the Fed’s forecast as of March, but investors now expect fewer reductions.
- Powell said that he thinks that the current rate setting is weighing on the economy, and that it will continue to do so over time.
The upshot? We may be headed for a longer period of high rates. For consumers mortgages could stay pricey for a while.
Feel free to call me at 503-7013-4699 or email me at sbfreedom@gmail.com if you have any questions and we can run some numbers.