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
Advocacy | Multifamily
Nov 06, 2026
Treasury Announces New Opportunity Zone Designations
The U.S. Department of the Treasury and the Internal Revenue Service have announced new Opportunity Zone designations for more than 6,500 communities nationwide, effective Jan. 1, 2027.
Membership Recruitment and Retention
Nov 05, 2026
The Value of Being One of NAHB's Top Recruiters
Member-to-member recruitment is essential for growing NAHB’s membership. Here are the perks members are being rewarded with for their efforts.
Latest Economic News
Economics
Nov 06, 2026
Hiring Rebounds in October, but Residential Construction Employment Declines
The U.S. labor market rebounded in October, with nonfarm payroll employment increasing by 165,000 jobs and the unemployment rate declining to 4.1%. However, the improvement in overall employment contrasts with continued weakness in residential construction, where employment fell by 16,400 jobs, the largest monthly decline since March 2021.
Economics
Nov 05, 2026
Multifamily Developer Confidence Weakens in Third Quarter
New multifamily housing confidence weakened year-over-year in the third quarter, according to the Multifamily Market Survey (MMS) by the National Association of Home Builders (NAHB). The MMS produces two separate indices. The Multifamily Production Index (MPI) had a reading of 41, down five points year-over-year, while the Multifamily Occupancy Index (MOI) had a reading of 69, also down five points year-over-year.
Economics
Nov 04, 2026
Mortgage Applications Decline as Higher Rates Boost ARM Share
Mortgage application activity declined in October as the 30-year fixed mortgage rate rose sharply again. The Mortgage Bankers Association’s (MBA) Market Composite Index, a measure of total mortgage application volume, fell 14.1% month-over-month in October on a seasonally adjusted basis. Compared to a year ago, total mortgage applications were 39.8% lower.