Good Thursday AM from your Hometown Lender,

For the first time in many meetings, rates didn’t move much on yesterday’s Fed announcement (it was really a non-announcement) and haven’t moved much since recovering from the initial reaction to the tariffs back in early April, generally staying in the 6’s for most loan programs. The Fed kept rates steady and said they are well positioned to address either labor market weakness or inflation (or both) when needed. During the post meting press conference, Fed Chair Jerome Powell basically kept answering the same question over-and-over. Powell was clear that the Fed is going to wait (he used some version of that word 22 times). The benign Fed statement and market reaction was a win. It’s not that there should have been a more hawkish response but with any big news, there is increased volatility, and it could have gone against us.

The FOMC announced it will take the following actions in considering its next movement of the federal funds rate:

• Carefully assess incoming data, the evolving outlook, and the balance of risks
• Continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities.
• Continue its commitment to supporting maximum employment and returning inflation to its 2% objective.

There was a little data today but more the usual.

Thursday rounds of unemployment data. There are no more economic data points on the calendar for today or tomorrow that should move rates much one way or the other, with the next big event being the CPI inflation data next Tuesday. That said, we did see the ECB drop rates, the Bank of England drop rates, a new trade deal with the UK and some other unscheduled news.

President Trump didn’t like the Fed pause (no surprise there or anywhere), posting on social media that “‘Too Late’ Jerome Powell is a FOOL, who doesn’t have a clue. Other than that I like him very much! Oil and Energy way down, almost all costs (groceries and “eggs”) down, virtually NO INFLATION, Tariff Money Pouring Into the U.S. – THE EXACT OPPOSITE OF ‘TOO LATE!’ ENJOY!” and so the taunting continues.

There was an interesting post meeting commentary from the Mortgage Bankers Association (MBA) SVP and Chief Economist Mike Fratantoni who said, “MBA forecasts that the risks to growth and the job market will wind up being the bigger concern this year, which will lead the Fed to resume cutting short-term rates in the second half of the year. Until then, the hard data on inflation and unemployment will continue to drive interest rates, including mortgage rates, from one end of a trading range to the other, with only a slight downward trend in mortgage rates over the remainder of 2025.”

Stay safe and make today great!