The Wa Wa Wa Market

If any of you are parents or were kids once, you probably remember a time when you were going on a vacation or to an amusement park, and it seemed to take forever. The kids in the back ask, “When are we going to get there?” The parents say just a “little bit longer,” and the kids cry, “Wa wa wa…”

This is where we stand with the market today. The grown-ups are the Fed, and the rest of us are the kids in the back. All of us in the back area are growing weary of the wait for lower interest rates, and the Fed keeps saying, “Wait, just a little bit longer.” The market was hopeful that we had arrived, but it seems we have a bit longer to go, and the market has reacted accordingly.

The economy keeps humming along, and unemployment is very low. Companies are doing fine as we continue to right-size the economy after the post-pandemic surge. One of the Fed’s primary mandates is to try to create the Goldilocks economy, which is not too hot but not too cold. Since the economy is doing okay right now, there is no urgent need on their part to lower rates. The area affected most is housing, as there are high-interest rates, and many buyers and sellers are holding off, not wanting to trade in their low mortgages. We are starting to see some movement in the real estate market as mortgage rates are beginning to move lower.

The road will eventually get us there, but we have yet to arrive. The Fed will continue driving with us in the back seat, waiting for them to let us know we are here.

Any opinions are those of the author and not necessarily those of Raymond James. This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Raymond James and your Raymond James Advisors do not solicit or offer residential mortgage products and are unable to accept any residential mortgage loan applications or to offer or negotiate terms of any such loan. You will be referred to a qualified Raymond James Bank employee for your residential mortgage lending needs.

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