Interest Rate Predictions 2023: Will Rates Increase in 2023?

Abstract

The Fed's primary instrument for controlling inflation is its ability to influence interest rates. Based on what it sees in the economy, the Fed can raise or lower its benchmark rate, known as the federal funds rate. The Fed wants to concentrate on slowing demand. It wants fewer people to buy new automobiles or put down bids on houses, lowering costs. When the Fed raises its benchmark interest rate, all types of financing become more expensive. Mortgage rates are no exception. Over time, this helps supply and demand rebalance. Fannie Mae expects the Fed to continue.