Fannie Mae Now Expects Only One Fed Interest Rate Hike in 2016

Shortly after the Federal Open Market Committee announced an increase of the federal funds rate in December, marking the first rate hike since June 2006, economists at Fannie Mae predicted that there would be three more rate hikes in 2016.

Last month, in the wake of the FOMC stating that it felt that current economic conditions did not warrant another increase of the federal funds rate, Fannie Mae cut its forecast from three projected rate hikes to two, stating that it expected increases in June and December.

But now, citing the FOMC’s repeated reluctance to raise rates again, Fannie Mae’s Economic & Strategic Research Group now expects only one rate increase in 2016.

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