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
Mar 31, 2026
NAHB’s Newest Savings Program Helps Members Build Financial StrengthFrom navigating cash flow to planning for long-term growth, having the right financial tools in place can make a meaningful difference. To help support members in these efforts, NAHB is excited to announce its latest member savings program partner: Signature Federal Credit Union.
Mar 30, 2026
NAHB Student Chapter at Alabama A&M University Off to Fast StartAAMU made its debut at the IBS Student Competition in Orlando. The chapter’s quick formation, ties to its local HBA and strong student leadership skills tell an inspiring tale of what NAHB members can do to support the future of the residential construction industry.
Latest Economic News
Mar 31, 2026
Soft Construction Labor Market Shows Decline for Open PositionsThe number of open positions in construction in February was down year-over-year, per the Bureau of Labor Statistics Job Openings and Labor Turnover Survey (JOLTS).
Mar 30, 2026
NAHB HBGI: Micro Markets Lone Bright Spot for Single-Family Building in Fourth QuarterSingle-family construction declined further in the fourth quarter in all but sparsely populated micro counties, according to the NAHB Home Building Geography Index (HBGI).
Mar 26, 2026
State/Local Property Tax Revenue Rises Past $210 Billion in the Fourth QuarterProperty tax revenue collected by state and local governments rose for the ninth consecutive quarter according to the Census Bureau’s quarterly summary of state and local tax revenue.