Portland Mortgage Market Update — June 20, 2025

It was Fed Week! The Fed met this week and decided… to do nothing. The market wasn't expecting a rate cut this week, and they didn't get one. Rates stayed the same but the juicier tidbit was the Fed updated their "dot plot" chart, which is where the survey each Fed member to see where they anticipate rates going through the end of next year. The consensus was there will still be two rate cuts this year, and some division over how many we will see in 2026. The division stems from the uncertainty the Fed has about inflation and the labor market. Chair Powell said "as we see more data, we're going to learn more about where inflation is headed…Right now it's just a forecast in a very foggy time… People can look at the same data and evaluate the risks differently"

One such person that is evaluating things differently is Fed Reserve Governor Christopher Waller. He is an economist (THANK GOD! Not an attorney!) who was appointed to the Fed in 2020. In an interview on CNBC's "Squawk Box" yesterday he said "I'm all in favor of saying maybe we should start thinking about cutting the policy rate at the next meeting, because we don't ant to wait till the job market tanks before we start cutting the policy rate". This echos what President Trump has been saying, and hopefully will put Waller in line to be in charge of the Fed.

And the Job Market might be facing a steeper decline in the near future. A WARN notice (Worker Adjustment and Retraining Notification) is required by the government when large business are going to be issuing sizeable layoffs in the next 60 days. The number of employees that were issued WARN notices in May reached 46,000. The only time this number has been higher was during the Great Financial Crisis and COVID. So we may see some serious weakening of the labor market in the coming months.