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- Powell signals Federal Reserve to move slowly on interest rate cuts
Powell signals Federal Reserve to move slowly on interest rate cuts
Plus: Compass to buy rival Anywhere in $4.2 billion deal
🐪 Welcome back! Today's newsletter is 643 words, a 2.5-minute read. Let’s dive in…
Disclaimer: Average mortgage rates as of September 23, 2025. © MND Daily Rate Index.
1. Mortgage demand stalls after mini refinance boom
After a massive 58% weekly surge in refinance demand the week before, mortgage demand stalled again last week, even though interest rates fell further.
Total application volume rose 0.6% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
Refinance demand, which had surged to the highest level since, rose just 1% for the week but were 42% higher than the same week one year ago.
Mortgage applications to purchase a home were essentially flat, up just 0.3 % for the week and up 18% from the same week one year ago.
“Interest rates generally have moved up following the FOMC meeting last week but remain in a range that should continue to lead to increased refinance activity. Refinance volume increased further last week and is now 80 percent higher than four weeks ago, accounting for more than 60 percent of all application activity,” said Mike Fratantoni, MBA Economist.
2. Fannie Mae revises rate outlook
The 30-year fixed-rate mortgage could fall below 6% by the end of 2026, according to the latest Fannie Mae forecast. That would be roughly 50 basis points lower than the government-sponsored enterprise’s year-end 2025 prediction of 6.4%.
Fannie Mae’s economics research team also revealed it has revised its 2025 total home sales forecast lower by roughly 20,000 units, to 4.72 million from 4.74 million projected previously.
Fannie’s projection of 5.16 million total home sales in 2026 also represents a downward revision of its previous estimate of 5.23 million units. Fannie Mae economists predict existing-home sales in 2025 will lag even 2024’s 30-year low of just 4.06 million.
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3. More Nuggets
💼 Trump appointees roll back enforcement of fair housing laws. (New York Times)
🏘️ Summer was strongest buyer’s market in more than a decade. (Redfin)
🌳 Pulte announces FHFA withdrawal from climate change coalition. (X.com)
📈 Pennymac matches UWM loan limit. (Pennymac)
🏢 Why lenders are competing to finance office-to-residential conversions. (Smry)
4. Powell signals Federal Reserve to move slowly on interest rate cuts
Fed Chair Jerome Powell signaled the central bank will move slowly on interest rate cuts, stressing caution to avoid reigniting inflation or over-tightening the job market.
This contrasts sharply with Trump-appointed officials like Stephen Miran and Michelle Bowman, who are pushing for faster, deeper cuts, arguing the labor market is already weakening.
Other Fed leaders, such as Austan Goolsbee, back Powell’s slower approach given inflation’s persistence above the 2% target. The split highlights growing divisions within the Fed.
If the Fed were to cut rates “too aggressively,” Powell said, “we could leave the inflation job unfinished and need to reverse course later” and raise rates.
5. Compass to buy rival Anywhere in $4.2 billion deal
Compass agreed to buy Anywhere in a $1.5 billion stock deal that would cement Compass’s status as the largest residential brokerage in the US. The deal, expected to close pending regulatory approval, would create a real estate powerhouse with an enterprise value of roughly $10B, including debt.
The merger, which has the approval of each companies’ board of directors, will boost Compass' network of real estate agents around the globe from about 40,000 to about 340,000, Compass said.
Compass’s acquisition of Anywhere Real Estate is the latest sign of a reshaping brokerage landscape. As market conditions tighten, scale and service diversification are becoming essential for survival—and dominance.
☀️ You’re all caught up. See you on Friday!
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