Following the rate increase, three statements were made that have the potential to boost commercial real estate investment activity.
• First, Chairman Jerome Powell said that the disinflationary process has started, and this will shape the Fed’s strategy going forward. There will be less pressure to increase interest rates.
• Second, it was mentioned that there’s a path to getting inflation back down to 2% without a really significant economic decline or a significant increase in unemployment.
• Third, ongoing rate increases are likely needed, but the Fed will revise their outlook at the March meeting. This is a significant step away from where we were a few months ago when the Fed was strongly telegraphing significant rate increases.