February’s trend toward higher rates continued this week, as the notes from the January FOMC meeting and comments from Fed officials made clear that rate cuts aren’t imminent. The minutes from the January meeting showed that many participants felt that there was greater risk in easing too soon versus waiting for a few more months of inflation data. Comments this week from Federal Reserve officials also suggested that a few more months of economic data is needed to confirm that cuts are appropriate. The economy is proving to be resilient, and the recent strong economic data is reducing the urgency in cutting rates. A rate cut at the March meeting was already priced out of the market, and now cuts in May are also seen as unlikely. The current consensus view in the market is for 4 cuts in 2024, starting with the June meeting.

While it is important for homebuyers to stay informed of the upcoming rate expectations, it is advised that they don’t delay a purchase in expectation of a future rate drop. In fact, it could be advantageous to buy now. Read this Market Update from September to find out why.