The quarter-point hike puts the benchmark rate at 5.1%, the highest in 16 years. But amid bank turmoil, the Fed also signaled future hikes could be put on hold. The Fed may now pause the streak of 10 rate hikes in a row that have made borrowing for consumers and businesses steadily more expensive. The Fed’s rate increases over the past 14 months have more than doubled mortgage rate. Chair Jerome Powell had said in March that a cutback in lending by banks, to shore up their finances, could act as the equivalent of a quarter-point rate hike in slowing the economy.
Mortgage Rates Tick Down
This week, mortgage rates inched down slightly amid recent volatility in the banking sector and commentary from the Federal Reserve on its policy outlook. Spring is typically the busiest season for the residential housing market and, despite rates hovering in the mid-six percent range, this year is no different. Interested homebuyers are acclimating to the current rate environment, but the lack of inventory remains a primary obstacle to affordability.
