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Fed Governor Waller says half-point rate hikes could be needed as ‘inflation is raging’

  • Fed Governor Christopher Waller told CNBC that the central bank may need to enact one or more half-percentage point rate hikes in the months ahead.
  • “Inflation is raging,” he said, as he pushed for aggressive moves that include balance sheet reduction soon.
  • Federal Reserve Governor Christopher Waller told CNBC on Friday that the central bank may need to enact one or more 50 basis point interest rate hikes this year to tame inflation.

    Though he voted this week for just a 25 basis point move due to uncertainty from the Russian invasion of Ukraine, Waller said he thinks the Fed may need to be more aggressive soon.

The average mortgage holder has a record $185,000 in equity.

  • Rising home prices mean today’s mortgage holders also have record levels of equity.
  • With interest rates poised to rise, many homeowners may want to tap those funds.
  • But just because you can, that does not mean you should, experts say.
  • Record increases in home prices are also pushing up the amount of equity people have in their abodes. For many Americans, that means they can borrow more against what is often their biggest asset.However, financial experts caution you should think carefully before making such a move.

    The average mortgage holder currently has about $185,000 in home equity to tap, which is the amount they can access while still retaining a 20% stake, according to mortgage research from Black Knight.

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Fed Chair Powell notes ‘highly uncertain’ Ukraine impact, but says rate hikes are still coming

  • Fed Chairman Jerome Powell said Wednesday he still sees interest rate hikes ahead though he noted the “implications for the U.S. economy are highly uncertain” from the Ukraine war.
  • Powell called the labor market “extremely tight” and said inflation has risen well above the Fed’s 2% target.
  • His remarks are part of mandatory appearances this week before House and Senate committees in Congress.
  • Federal Reserve Chairman Jerome Powell still sees interest rate hikes coming, but noted Wednesday that the Russia-Ukraine war has injected uncertainty into the outlook. Powell said he sees a series of quarter-percentage-point increases coming, though he left open the possibility of moving more aggressively should inflation persist. In remarks prepared for dual appearances this week before House and Senate committees in Congress, the central bank chief acknowledged the “tremendous hardship” the Russian invasion of Ukraine is causing.  “The implications for the U.S. economy are highly uncertain, and we will be monitoring the situation closely,” Powell said.

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Mortgage rates plunge just as home prices set another record.

  • The average rate on the popular 30-year fixed mortgage had risen close to a full percentage point from the start of this year up until last Friday, when it hit 4.18%, according to Mortgage News Daily.
  • It hit 3.9% on Tuesday.
  • This will give homebuyers more purchasing power as the historically busy spring season kicks off. It will also keep record-high home prices continuing on their run higher.
  • Mortgage rates are sinking as markets contend with the ramifications of Russia’s attack on Ukraine, and that means home prices are likely to continue surging.The average rate on the popular 30-year fixed mortgage had risen close to a full percentage point from the start of this year up until last Friday, when it hit 4.18%, according to Mortgage News Daily. It then fell to 4.04% Monday and 3.9% on Tuesday. That is the largest two-day drop since March 2020, the start of the pandemic.

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