Week In Review

On Thursday the Federal Reserve chairman Jerome Powell announced a 0.25% rate cut. Speaking at his press conference later that day, Powell said he was "feeling good about economic activity." He did reference the upcoming December 18 meeting at which another 0.25% rate cut is expected, but the chances of that cut have been diminished in recent weeks. And while we saw the Fed's rate come down this week, the 30-year mortgage rate actually rose for the sixth straight week to 6.79%. We mentioned this last week, but mortgage rates have more to do with longer-term bonds and other factors than they do with the Fed's overnight rate. We saw a spike in the 10-year treasury following president elect Trump's victory, which can be interpreted as the bond market pricing in a elevated probability of higher future economic growth, inflation, and government debt.