Federal Reserve Declines to Raise Rates

Mike Fratantoni, SVP and chief economist for the Mortgage Bankers Association (MBA), said: “The job market remains strong, with the unemployment rate at a 50-year low, and inflation remains near the Federal Reserve’s target. As a result, the market anticipates that the Fed is unlikely to move rates this year, and today’s communication is consistent with this expectation. We continue to expect that the Fed’s next move will be a rate increase at some point in 2021. In recent months, the Fed has been successful in providing sufficient liquidity to the market through Treasury bill purchases, and there was no spike in rates at year’s end – as some had feared. The Fed’s plans with respect to further growth of the balance sheet, and ongoing support for market liquidity, continue to evolve.”