New York Fed chief says more hikes lie ahead, a signal for brokers advising clients on mortgage rate locks and pricing
Federal Reserve Bank of New York President John Williams said that more interest rate hikes are likely as the central bank works to pull inflation back to its 2% goal.
Williams did not say when the Fed would move again or how far it would go.
Speaking at the UC Berkeley Alumni Salon in New York, he said, “The economy is strong, labor market continues to strengthen, and inflation is persistent.”
He added: “We still have work to do … to get monetary policy to the right place.”
Traders have already priced in the next move. Futures markets expect the Federal Open Market Committee (FOMC) to lift its 3.75% to 4% target range by a quarter point when it meets Dec. 8–9, and CME FedWatch pricing put the odds at 93% for December and 67% for a further increase in January 2027.
Why is the Fed leaning toward more hikes?
The October consumer price index topped forecasts for a third straight month, with core inflation, which strips out food and energy, rising 0.3%.
Fed Governor Christopher Waller had said a reading at that pace would put a 50-basis-point increase on the table, and in remarks at a London conference on Nov. 10 he said a half-point move “should be considered at the December meeting.”
Cleveland Fed President Beth Hammack has made a case for a modest, steady pace, while Philadelphia Fed President Anna Paulson said “further gradual tightening seems appropriate.”
The labor market gives the committee room: unemployment slipped to 4.1% and private payrolls posted their strongest gain since March.
Williams said the Fed can do little about the higher cost of living, warning that reversing price levels would cause “huge distortions and damage to the economy.”
Michael Pearce and Bernard Yaros of Oxford Economics say strong jobs data, persistent inflation, and AI-driven investment are reinforcing expectations for a December Fed rate hike, with mortgage rates likely to remain elevated. https://t.co/FJNAquFXeV
— Mortgage Professional America Magazine (@MPAMagazineUS) November 11, 2026
What does it mean for mortgage brokers?
Borrowers have had a brief reprieve. Freddie Mac reported the 30-year fixed-rate mortgage averaged 7.11% for the week ending Nov. 12, a fourth straight decline and a seven-week low. That relief is fragile as the 10-year Treasury yield climbed to 5.068% on Thursday as oil prices rose.
Yury Shraybman, an originator at Innovative Mortgage Brokers in Pennsylvania, said the rate climb has made some buyers more cautious, particularly those already stretched on their monthly payment.
“I tell my clients to focus on the overall payment rather than just the rate, so we are looking at different ways to structure the loan, including seller concessions, temporary or permanent buydowns, and ARMs when they actually make sense for that particular buyer,” he told Mortgage Professional America.
Melissa Cohn, regional vice president of William Raveis Mortgage in New York, said the path of mortgage rates will “largely depend on oil prices and the war in Iran.”
Mike Fratantoni, chief economist at the Mortgage Bankers Association (MBA) in Washington, DC, said a resilient job market and inflation that is still too high are “likely to lead the FOMC to hike rates in December,” with another increase expected in the first quarter of 2027.
Barry Habib, CEO of MBS Highway, has urged brokers to warn clients to expect sudden price swings.
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