The Federal Open Market Committee of the Federal Reserve said in its post-meeting statement that the Federal Reserve expects to raise its benchmark interest rate range twice during 2023. No rate changes will be made during 2022 as the economy continues to recover from the Covid-19 pandemic. The Fed’s current interest rate range is 0.00 to 0.25 percent.
Fed Expects “Transitory” Inflation
The Fed’s post-meeting FOMC statement said that although Committee members adjusted their forecast for raising the Fed’s benchmark interest rate range, members did not predict long-term inflation and described current upward inflation as “transitory.”
The Consumer Price Index reported that the cost of living jumped in May and drove inflationary growth to a 13-year high of five percent.
11 of 18 FOMC members currently expect two or more rate hikes in 2023; in March, seven members expected one rate hike in 2023. Former Treasury Secretary Larry Summers said that the Fed needs to reconsider its monetary policies based on the two stimulus payments provided to Americans. The Fed has held its benchmark interest rate range to 0.00 to 0.25 percent and continued its monthly purchases of $80 billion in Treasurys and $40 billion in Mortgage-Backed Securities in efforts to support the economy and stabilize financial markets.
The Committee will follow economic news and developments through readings on public health, labor market conditions, inflation, and financial and global news to determine monetary policy adjustments.
Fed Chair Suggests Future Tapering of Bond Purchases
Federal Reserve Chair Jerome Powell said in his post-FOMC meeting press conference that members had their first discussion of tapering the Fed’s bond purchases. Although the Fed has indicated it wants to see “substantial further progress” in the economy before it starts to taper its bond purchases, analysts expected further discussion of tapering bond purchases in FOMC’s July meeting. Reducing bond purchases is considered the first step in moderating the Fed’s accommodative stance on monetary policy.
Chair Powell said that the FOMC will continue to develop monetary policy in consideration of the FOMC’s dual mandate of achieving maximum and an annual inflation rate of two percent over the longer term. Inflation has run below two percent for some time before the pandemic; so a current inflation rate running above two percent would help raise the average inflation rate to the two percent requirement.
The unemployment rate is improving as businesses and other employers open their doors and restore service to full capacity. Chair Powell cautioned that the economy remains strongly connected to how the Covid-19 virus progresses and said that monetary policy would be adjusted according to how the pandemic impacts the economy.
It can be a bit of a surprise if your home turns out to be valued at less than the purchase price offered, but this is the type of thing that can occur in an appraisal situation. While this can change everything from your contract to the amount of your down payment if your home has been appraised at less than you envisioned, here are some options you may want to consider.
Before you let a potential buyer see your home, take the following steps to ensure a great showing. These surprising secrets of successful home staging will help.
Homeowners who are thinking about listing their home for sale in the coming weeks or months may be focused on improving their home to help it sell more quickly, but there also may be a focus on adding value to the home in the process. While each home is unique, there are a few projects that most homeowners would benefit from. In fact, these are a few simple and easy projects that can typicaly be completed over the course of a weekend; that can add value and desirability to the home.
The Core Consumer Price Index, which excludes volatile food and fuel sectors, rose by 0.70 percent in May and was 3.80 percent higher year-over-year for a 29-year high.
There are thousands of people who turn 65 every day, which is the typical retirement age. Before the development of the pandemic, most people had to wait to retire before they could move to their retirement homes. Due to the pandemic, a lot of people are working remotely, giving them a chance to move to their retirement homes before they actually retire. Is it a smart idea to move before retiring? If the next phase of life is calling, now might be a time to make the move to a retirement home, whether this is a home on the beach or a sprawling property located in the countryside.