Who's Making Rate Decisions at the Fed?

 

Who's Making Rate Decisions at the Fed? The Federal Open Market Committee (FOMC) is responsible for making decisions about interest rates. The FOMC is made up of 12 voting members: 7- Board of Governors, 1- President of the Federal Reserve Bank of New York and 4- Reserve Bank presidents who serve one-year rotating terms. The FOMC meets eight times a year, and a majority vote is not required to approve any rate changes. The President appoints, with Senate approval, the seven Board members, including the Chair. Currently, Chair Jerome Powell’s term as Chair runs until May 15, 2026. His term as a Board member lasts until January 31, 2028. President Trump has repeatedly pressured the Fed to lower rates, even calling for a 1% Fed Funds Rate. He also threatened to fire Chairman Powell, a move that could create chaos given Powell would remain on the Board. While no one can predict exactly what the President will do, his public stance has been clear: he favors lower interest rates, and would likely appoint a like-minded successor as Chair when Powell's term ends. What Are We Getting At? Unless inflation surges, it’s reasonable to expect the Fed may begin lowering rates before May — potentially more than once. Home sales are in a sharp decline, we are expecting the fed to act sooner than latter to lower rates. With a new appointment in May 2026, wouldn’t you agree that he is most likely to appoint someone with his own view of interest rates? That seems to be his preference this term. No dissenters. Let's get ready for the pent up demand of commercial real estate loans. CUFR is ready to assist.  Why CU First Responders Finance?  CUFR Knows your Market  Annual Reviews – MBL Expertise  Low-Cost MBL Underwriting  MBL & Green Loan Origination Programs  Join our Participation Network – Buy & Sell Let’s get ahead of the curve. Lower rates may be coming — be ready when demand returns. Find out More

Murray Halperin Managing Member murrayh@FinanceResponders.com 561.409.8786