Federal Reserve Delays Rate Hike: Industry Reacts

first_imgSign up for DS News Daily Tagged with: Banking Federal Reserve Interest rates Mortgage-Backed Securities Citing a strong labor market, increased household spending, and a lower unemployment rate, the Federal Reserve announced that it will be keeping the federal funds rate at 2.25 to 2.50 percent. Wednesday’s statement announced that The Board of Governors of the Federal Reserve System voted unanimously to set the interest rate paid on required and excess reserve balances at 2.35 percent.“The Fed held rates steady today,” said realtor.com Chief Economist Danielle Hale. “Data since the last FOMC meeting has been positive, with stronger than expected readings on March jobs and first quarter GDP.  The only laggard is inflation, which continues to fall below the Fed’s target. While the late 1970s were characterized by stagflation — weak economic growth and stubbornly high inflation — the late 2010s are notable for the opposite — decent economic growth and stubbornly low inflation. The playbook for responding to these conditions is less-well developed, hence the need for patience.”The Federal Open Market Committee (FOMC) directed the Open Market Desk at the Federal Reserve Bank of New York to roll over at auction the amount of principal payments from the Federal Reserve’s holdings of Treasury securities maturing during each calendar month that exceeds $15 billion. Additionally, the Desk is to continue reinvesting in agency mortgage-backed securities the amount of principal payments from the Federal Reserve’s holdings of agency debt and agency mortgage-backed securities received during each calendar month that exceeds $20 billion.According to LendingTree Chief Economist Tendayi Kapfidze, the Fed’s previous outlook may have been an overreaction resulting from December’s market volatility and the recent government shutdown.“In our interpretation, the Fed may be overreacting to market volatility that occurred in December and distortions to economic activity and data from the government shutdown,” Kapfidze stated. “While many measures of economic growth have slowed, sentiment data which is more timely has rebounded from those declines. There are also seasonal distortions that have been occurring in the first quarter, with the economy often accelerating in the second and third quarter.” Subscribe Servicers Navigate the Post-Pandemic World 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago Demand Propels Home Prices Upward 2 days ago Demand Propels Home Prices Upward 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Related Articles Data Provider Black Knight to Acquire Top of Mind 2 days ago About Author: Seth Welborn Previous: Mortgage Professionals Unite to Support Cancer Charity Scholarship Gala Next: Preventing Disaster-Related Mortgage Defaultcenter_img The Best Markets For Residential Property Investors 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Federal Reserve Delays Rate Hike: Industry Reacts Share Save Banking Federal Reserve Interest rates Mortgage-Backed Securities 2019-05-01 Seth Welborn Seth Welborn is a Reporter for DS News and MReport. A graduate of Harding University, he has covered numerous topics across the real estate and default servicing industries. Additionally, he has written B2B marketing copy for Dallas-based companies such as AT&T. An East Texas Native, he also works part-time as a photographer. Home / Daily Dose / Federal Reserve Delays Rate Hike: Industry Reacts The Week Ahead: Nearing the Forbearance Exit 2 days ago in Daily Dose, Featured, Government, News, Secondary Market The Best Markets For Residential Property Investors 2 days ago  Print This Post May 1, 2019 2,419 Views last_img

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