Fed Chair Jerome Powell took the podium on Wednesday to announce that the central bank would hold interest rates flat in June. Powell didn’t rule out future hikes, and called this move a “skip.”
Towards the end of the press event, Powell was asked to give an update on the nation’s most interest-rate-sensitive sector: the U.S. housing market.
“Housing is certainly very interest [rate] sensitive. It’s one of the first places that is either helped by low rates or held back by higher rates, and we certainly saw that over the course of the last year. We now see housing putting in a bottom, and maybe moving up a bit. We’re watching that situation carefully. I do think we’ll see rents and house prices filtering into housing services inflation [overall housing costs as tracked by CPI], and I don’t see them coming up quickly. I see them wandering around at a low level.”
Powell didn’t specify if he thought U.S. housing market activity had bottomed, or if he meant U.S. home prices had bottomed.
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Source: finance.yahoo.com
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