Fed expected to hold rates steady as Utahns continue to feel economic pressure

SALT LAKE CITY — As the Federal Reserve concludes its latest policy meeting, economists expect no immediate change to interest rates, though another increase remains possible before year's end.

"We think they're going to keep rates steady," said Maddy Oritt, economist with the Kem C. Gardner Policy Institute. "We don't think they're going to change anything at this point. There is one more meeting before the end of the year in December, and there may be an increase at that point, but for the meeting today and tomorrow, we don't think they'll make any changes."

While the Fed's benchmark rate does not directly determine mortgage rates or other consumer borrowing costs, Oritt said many of the same economic factors influence both.

"People don't feel good," Oritt said. "We're seeing average mortgage rates across the United States above 7% for the last month. Housing affordability is already a huge issue in Utah, and having a high mortgage rate exacerbates that effect."

Utah's housing market continues to be a significant source of concern for many families. Oritt noted that elevated inflation, economic uncertainty and broader market conditions are keeping borrowing costs high across several sectors.

"Things like mortgage rates, credit card rates and auto loan rates all factor in high inflation, economic uncertainty and risk," she said. "We are seeing those rates continue to be elevated, and people don't feel good. We see that in the data."

According to Oritt, recent consumer sentiment surveys reflect growing unease among Utahns and Americans alike.

"People just feel uncertain," she said. "There are affordability issues, and we're not seeing those things getting better right now."

Despite these challenges, Utah's economy remains stronger than many other states. Still, Oritt cautioned against assuming the state is insulated from national economic trends.

"We're not immune," she said. "We have a really strong economy and we tend to outperform the nation when you look at a lot of different economic variables. But we're still going to be affected by the ebbs and flows of the national economy."

She pointed to signs of moderation in Utah's labor market, though conditions remain healthier than the national average.

"We are seeing slowing in our labor market," Oritt said. "We're still seeing a pretty steady labor market, certainly much better than the national level, but it is slowing down."

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Looking ahead, Oritt said uncertainty remains one of the biggest forces shaping the economic outlook.

"There is a lot of uncertainty," she said. "There is a lot of money flowing through the economy, but there's uncertainty about the implications of that and how that will trickle down into the labor market."

For Utahns interested in tracking economic forecasts and trends, Oritt recommends visiting the Gardner Institute's website.

"We have what's called the Utah Economic Council," she said. "It's a collection of academic, public and private sector economists, and we do a quarterly forecast. We forecast national and Utah economic variables and make that information available on our website."

The Utah Economic Council's next forecast update is expected in December.

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