Fed hikes as borrowing costs climb and housing cools
We enter the September 22 week with U.S. borrowing costs under renewed pressure. The Federal Reserve raised its target rate by a quarter point, the 10-year Treasury remains close to 5%, and the latest 30-year mortgage average climbed to 6.95%. Housing construction is mixed: total starts and permits fell in August even as single-family starts improved. Consumer spending remained strong, while new Dominican labor data showed continued job growth.
01 · MONETARY POLICY
The Federal Reserve raises rates by a quarter point
The Federal Open Market Committee voted unanimously on September 16 to raise the federal funds target range by 0.25 percentage point to 3.75%–4.00%. The Committee said economic activity was expanding at a solid pace, domestic spending was resilient, and inflation remained elevated.
The U.S. Treasury's daily par yield curve placed the 10-year yield at 4.96% on September 21, compared with 5.01% on September 18. The 30-year yield was 5.29% on Monday.
Freddie Mac's September 17 survey put the average 30-year fixed mortgage rate at 6.95%, up from 6.76% a week earlier. The 15-year average increased to 6.26% from 6.09%. These are national weekly averages based on loan applications, not individual borrower quotes.
Privately owned housing starts ran at a seasonally adjusted annual rate of 1.275 million in August, down 2.6% from July. Permits fell 2.7% to 1.394 million and completions dropped 11.9% to 1.128 million, while single-family starts increased 7.6% to 918,000.
Advance estimates put U.S. retail and food-services sales at $773.9 billion in August, up 1.2% from July and 6.0% from a year earlier. The figures are seasonally adjusted but not adjusted for price changes.
The Banco Central de la República Dominicana reported 5,271,005 employed people in the second quarter of 2026, an increase of 147,456 net jobs, or 2.9%, from the same quarter of 2025.