Research | Inflation, The Economy, and Commercial Real Estate

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Inflation, the economy, and commercial real estate graphic

In June and July of this year, the Fed raised the interest rate at the fastest pace in forty years: it raised the federal funds rate 75 basis points at each open market committee meetings. Why did it do so, and what do its actions and current economic data say about the economy? This report will investigate and answer these questions, as well as explore the thinking that is guiding the Fed’s policies and explain the implications of these policies for commercial real estate.

INFLATION AND THE ECONOMY

  • What is the federal funds rate and what did the Fed do with it in June and July of 2022?

  • Why did the Fed raise the fed funds rate by so much in June and July?

  • What does current economic data say about the state of the economy?

  • What does the mixed economic data imply for future Fed policy regarding rate?

COMMERCIAL REAL ESTATE IMPLICATIONS

  • Given future increases by the Fed and current inflationary conditions, what implications does this have on commercial real estate?