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Inflation & Fed Rate Increase

Current Average National Rates

The Fed raised rates by 0.5% Wednesday. What did mortgage rates do? Nothing! The Fed moving the federal funds rate does affect mortgage rates. However, these rate increases factor in much sooner than the actual change. The forecast of the 0.5% increase and the future increases were expected and already factored into rates today. When will we see rates move based on a fed meeting? When the unexpected happens or when related to the Fed’s commentary. For example if a 0.5% increase is expected and a 0.25% raise happens, we would see an immediate rate drop. If 0.5% was expected and 0.75% happens, we would see an immediate increase to rates.

November CPI/Inflation report released on Tuesday. Inflation was lower than expected. Great News! This release dropped rates some over the prior week’s increases. The Fed is raising the federal funds rate due to elevated inflation. Monitoring the inflation numbers is a key indicator of where rates might go.

Want to learn more on why I expect rates to DROP in the future and why to buy BEFORE they do? Join us at the next Rates, Real Estate, Recession and Why to Buy Now class! Let me know if you want an invite!

Below are national average current rates. For a real time specific quote, always contact us. A couple of reminders:

  • Interest rates are not one size fits all. Rates are different for each client. Some of the variables include – credit score, loan to value, loan amount, occupancy, property type, loan term, how long the rate is locked for, discount points paid, among many others.
  • One of the biggest indicators of rate is time. Rates move all day every day, just like the stock market. Over the last couple of months, we have seen this be more the case than historically.