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The Federal Reserve is committed to using its full range of tools to support the U. S. economy in this challenging time, thereby promoting its maximum employment and price stability goals. With inflation running persistently below this longer-run goal, the Committee will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the Committee’s assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time. In addition, the Federal Reserve will continue to increase its holdings of Treasury securities by at least $80 billion per month and of agency mortgage‑backed securities by at least $40 billion per month until substantial further progress has been made toward the Committee’s maximum employment and price stability goals.

Further, they said they would prefer to have inflation run above 2% for a period of time because we’ve spent so long under the Fed’s 2% price growth target. A 3-month average that looks at all home prices, this is the highest the index has been since 6 ½ years ago from an annual appreciation standpoint. The average rate on a 30-year fixed mortgage with 0.6 points paid in fees was up 16 basis points to come in at 2.97% last week. Finally, the average rate on a 5-year, treasury-indexed, hybrid adjustable-rate mortgage was up 22 basis points to 2.99% with 0.1 points paid, down from 3.2% in late February 2020.

Completed units last month were at a seasonally adjusted annual rate of 1.417 million, which is 2.8% higher than the 2019 rate. Coming in at an annual rate of 6.76 million, existing home sales were up 0.7% for the month and 22.2% since last December. Supply relative to sales is at 4.3 months in December, which is low, but looks awesome compared to the existing home sales supply issues. The average interest rate on a 30-year fixed mortgage with 20% down and 0.7 points paid in fees was down 4 basis points to 2.73%, having fallen from 3.51% last year.

With inflation running persistently below this longer-run goal, the Committee will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the Committee’s assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time. In addition, the Federal Reserve will continue to increase its holdings of Treasury securities by at least $80 billion per month and of agency mortgage‑backed securities by at least $40 billion per month until substantial further progress has been made toward the Committee’s maximum employment and price stability goals. As of last week, the Fed holds $2.1 trillion of MBS, which is one of the ways it keeps rates low and support the housing market, which accounts for a huge portion of overall economic activity.