'Wrong direction': CNN analyst says Trump win is already hitting Americans in the pocket
President-elect Donald Trump's imminent ascent to the White House is already making it more difficult for Americans to buy homes, an economic analyst says.
Home loan interest rates have seen an steep uptick to a 6.8 percent average for 30-year fixed mortgages as the bonds market prepares for Trump's economic policies, CNN business reporter Matt Egan said Thursday.
"That's going in the wrong direction," Egan reported. "That is happening because the bond market is getting more optimistic about the economy, but also starting to price in the trillions of dollars in debt that could get added from Trump's plans to cut taxes."
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Trump's tax proposals could increase the national debt by $7.75 trillion through 2035, according to economic forecasts.
Those plans include cutting taxes on Social Security benefits which would reduce revenue by $1 trillion over 10 years and hasten the fund's depletion, currently projected to run out of cash in the same time span, according to a Washington Post analysis.
The rich would benefit through promised 2017 tax cut extensions that would reduce revenue by $3.9 trillion and a promised end to an income tax cap experts say will benefit the top 10 percent of earners, according to the Post.
Mortgage rates stood at 6.1 percent in September when the Federal Reserve, the nation's central banking system, lowered interest rates for the first time in four years, according to Egan and a New York Times report on the cut.
Jerome Powell, the Fed chairman selected by Trump in 2018, is expected Thursday to announce another cut on interest rates by about a quarter of a point, CNN reported.
"There is some drama over what Fed officials are going to say," said Egan.
"Powell is going to face a lot of questions at this press conference about the elephant in the room, right? President- elect Trump's economic agenda, and what those proposals mean for the economy, for jobs, for inflation."