Federal Open Market Committee (FOMC) Statement
Their economic projections were a mixed bag for mortgage rates. They revised their prediction for overall GDP growth to 2.5% next year, up from the 2.1% they made in September. The update also showed a slight downward revision to next year’s unemployment rate. The good news came in the inflation estimates. While they were unchanged, they were left at levels that are higher than the current rate and higher than many market participants feel can be met. That means that the markets feel inflation will continue to run lower than the Fed’s preferred rate, helping to prevent a more aggressive rate hike plan. Some think that if inflation continues to run below expectations, the three rate moves next year may not happen either.