Fed in No Rush to Cut Rates
In a widely anticipated announcement, the Federal Reserve paused on rate cuts at the conclusion of its January meeting, holding the federal funds rate in the 4.25% to 4.5% range. The Fed will continue to reduce its balance sheet, including holdings of mortgage-backed securities.
The Fed noted the economy remains solid, while specifying a data-dependent pause. Fed Chair Jerome Powell did qualify current policy as “meaningfully restrictive,” but the central bank appears to be in no hurry to enact additional rate cuts.
Given the ongoing, outsized impact that shelter inflation is having on overall inflation, an explicit mention to housing market conditions would have been useful. However, Powell did state in his press conference that housing market activity appears to have “stabilized.”
Although improving, shelter inflation is running at an elevated 4.6% annual growth rate, well above the Consumer Price Index (CPI). These housing costs are driven by continuing cost challenges for builders such as financing costs and regulatory burdens, and other factors on the demand-side of the market like rising insurance costs.
NAHB Chief Economist Robert Dietz offers more insights from the Fed's January meeting in this Eye On Housing article.
Additionally, the latest Macro Economic Outlook from NAHB provides further details about the pace of housing inflation, as well as a recap of 2024 economic conditions, a forecast for 2025 interest rates, and more. Watch the video below or visit the Macro Economic Outlook video library on nahb.org.
Latest from NAHBNow
Legal
Nov 11, 2026
Persistence and NAHB Support Deliver Victory in Michigan Permit Fee Case
For more than 15 years, the Home Builders Association of Michigan (HBAM) has been battling the city of Troy, Mich., in court over the city’s shift to a privatized permit fee process. The case was finally decided in HBAM’s favor.
Advocacy
Nov 11, 2026
Widespread U.S. Housing Ballot Wins; Two Key NAHB-Backed Defeats
Although housing ballot measures fared well nationwide in the midterm elections, two NAHB-backed initiatives were defeated: one to streamline environmental reviews in California and another to address minimum lot sizes for single-family homes in Massachusetts.
Latest Economic News
Economics
Nov 10, 2026
Consumer Credit Growth Picks Up in the Third Quarter of 2026
Consumer credit growth accelerated in the third quarter of 2026, with both revolving and nonrevolving credit increasing at their fastest quarterly rates since 2022. Total outstanding consumer credit reached $5.22 trillion, continuing an upward trend that has strengthened over the past year.
Economics
Nov 10, 2026
Inflation Persists in October
Inflation remained elevated in October even as energy prices eased, raising expectations of another Fed rate hike. Shelter returned as the largest driver of headline inflation, accounting for over 30% of the monthly increase. Core inflation, which excludes volatile food and energy components, rose by 0.3% for the third consecutive month, suggesting broad-based price pressures across the economy.
Economics
Nov 09, 2026
Residential Building Worker Wage Growth Rebounds, but Real Wages Continue to Decline
Wage growth for residential building workers showed signs of a modest rebound in September 2026 following a sharp slowdown earlier in the year. According to the latest data from the U.S. Bureau of Labor Statistics, nominal wage growth picked up from its June pace, although it remained relatively modest.