As inflation continues to exceed the Federal Reserve's 2% target, it poses challenges for monetary policy amid stable employment figures. In May, non-farm payrolls grew by 139,000, indicating a stable job market, while year-over-year inflation rose to 2.4%. The Federal Open Market Committee has paused rate cuts since January, creating a dilemma as some experts suggest that lowering rates could hinder mortgage servicer management. Lenders are preparing for a potential refinancing boom, indicating strategic shifts in operations amidst ongoing economic fluctuations.
At 2.8% for May, core CPI inflation has stopped declining, leaving many to speculate whether the Fed should lower rates or keep them the same, said Geno Paluso, CEO of Sagent.
Meanwhile, mortgage lenders are shifting resources and expanding borrower education efforts in anticipation of refinancing opportunities, according to Nash Paradise, director of sales at UMortgage.
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