Closing Bell Closing Bell Overtime: The Fed Keeps Rates Steady; UWM CEO On Housing Impact 6/18/25
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Jun 18, 2025 Sassan Ghahramani, President and CEO of SGH Macro Advisors, joins to discuss how current macroeconomic trends and geopolitical risks impact the markets. He analyzes the Fed's decision to keep interest rates steady and its implications for future economic forecasts. Mat Ishbia, CEO of UWM, provides insights on the mortgage market and housing trends amid rising interest rates. The conversation also touches on the tensions between the U.S. and Iran, exploring their potential market ramifications.
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Fed's Stagflation Warning
- The Fed foresees a potential rise in inflation due to tariffs later this year and expects weaker GDP growth, suggesting stagflation risks.
- However, their cautious stance highlights uncertainties, indicating data will guide future rate actions, making a September rate cut unlikely.
Market's Diminished Fed Sensitivity
- Despite the Fed's hawkish tone regarding inflation risks, the market remained calm, signaling diminished influence of the Fed's guidance.
- This suggests future policy signals may come from new Fed leaders or external factors rather than current Fed communications.
What Could Trigger Fed Cuts?
- For the Fed to cut rates twice this year, inflation must significantly ease and the labor market weaken.
- The Fed is close to neutral rates and may hold steady or even raise rates if inflation surges, underscoring uncertainty in future moves.