The following is MBA SVP and Chief Economist Mike Fratantoni’s commentary following the Federal Reserve’s FOMC statement released this afternoon on monetary policy and the economy:

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“FOMC projections show that members expect both increases in the unemployment rate and inflation through the course of this year. At this point, neither trend warrants a change in the federal funds target. The FOMC statement continues to highlight the high level of uncertainty regarding the economic outlook, which also likely led the Fed to hold to its current policy stance.

“A highlight of the projections is that the median FOMC member still expects two additional rate cuts in 2025. The median for 2026 showed one fewer cut than had been the case in the March projections.

“All in, a Fed on hold aligns with our forecast for little change in mortgage rates for the time being. MBA data continue to show modest increases in purchase application activity relative to last year, and we expect that trend to continue for the remainder of 2025 and into 2026.