Guess you never thought you would receive a happy holiday message straight from the Federal Reserve Board of the United States. But they were concerned that you might think they were a bunch of scrooges ruining your year with horrific interest rate increases throughout 2022. So, they decided to leave you a holiday greeting like only the Fed can. As we mentioned previously, the past four Fed meetings over the past six months have seen significant interest rate increases of 0.75% each time.

Last week, the Fed raised short-term interest rates by “only” 0.5%. Now, this increase is still very consequential. But after the past six months, it feels like the Fed is taking their foot off the pedal a little bit. And their statement after the meeting indicated that they recognize progress is being made against inflation. Though, they are still preparing us for additional hikes in 2023 — which we are now assuming will be smaller.

Last week’s consumer price index was a major data point guiding the Fed in their decision. The increase of 0.1% from last month was less than forecasted. The core number excluding food and energy was also a tame 0.2%. Annually, we are now seeing a rate of 7.1%, down from last month. Is this enough progress to sway the Fed to continue easing up on the pedal? We won’t know that until the next meeting at the beginning of February. For now, we will just savor the holiday message. No return card is necessary!

Dave Hershman is the top author in the mortgage industry. Dave has published seven books, as well as hundreds of articles and is the founder of the OriginationPro Marketing System and Mortgage School. Want to send this commentary and other news in a personalized format to your sphere database or on social media?  Sign up for a free trial at

Jessica Starvaggi

OriginationPro/The Hershman Group