In short: In Chairman Kevin Warsh’s first meeting, the Committee unanimously left the target rate unchanged, but half of SEP participants expected higher rates by the end of 2026.

What’s next for rates?

In the Summary of Economic Projections (SEP), half of the 18 participants expected at least one hike by year-end; 8 expected no change, 1 expected a cut, and Chairman Warsh did not submit a forecast. The recent oil price shock reversed some progress on inflation and pushed consumer price inflation above 4%. At the same time, upward revisions in the latest employment report suggest the labor market is firmer than previously measured. The balance of risks has shifted: the next move now looks more likely to be a hike than a cut.

What’s the impact on housing? 

Affordability has quietly improved from a year ago, and conditions for buyers are better — but those gains are being offset by higher costs elsewhere. Even with slightly lower housing costs, years of underbuilding have left a structural housing supply deficit that no chair appointment can fix.