LendingTree chief economist predicts first rate change in over a year

LendingTree chief economist predicts first rate change in over a year

The next Federal Open Market Committee (FOMC) meeting will take place on Tuesday, September 18. LendingTree Loans Chief Economist Jim Svinth forecasts a rate decrease of at least 25 basis points.

Svinth states, “With continuing deflation in the housing market, the current credit freeze, and the recent employment data, the Fed will be looking to prevent any broad economic downtown by reducing the target Fed Funds rate by .25% to .50% tomorrow.”

Svinth adds, “The market has already priced in at least a .50% reduction over the next two Fed meetings. Anything less than this will give the impression the Fed is out of touch with how the housing and mortgage markets are truly hitting Main Street.”

A rate cut tomorrow will break a year long pause campaign that has been in effect since August 8, 2006.