The Federal Funds Effective Rate (4.25%–4.50%) exceeds the CPI inflation rate (2.4% year-over-year, March 2025). This gap shows the Fed’s tight policy to curb inflation, which is easing. Declining inflation may lead to lower rates and borrowing costs, though tariffs could spur volatility.

The takeaway ... Inflation is moderating, trending downward. As inflation continues to decline, interest rates are expected to follow, leading to lower home borrowing costs.