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A fresh round of headlines broke this morning: the U.S. and Japan have reached a new tariff agreement, cutting auto duties from 27.5% to 15%. On paper, it appears to be a win. In practice? That 15% rate is still well above pre-trade-war levels, meaning the pressure on consumer goods—and inflation—remains very much intact.
That brings us to the Federal Reserve.
The Fed’s Next Move: Still on Hold?
Despite market speculation and mounting political pressure, don’t expect the Fed to lower interest rates at its upcoming July 29–30 meeting. While inflation is gradually slowing in some areas, core consumer prices—especially those tied to imported goods—remain stubbornly elevated.
June’s Core CPI rose 0.2%. That might not seem dramatic, but in a climate shaped by trade friction and supply chain volatility, even modest increases keep policymakers cautious. Tariffs, after all, function like an indirect tax: they raise prices for consumers without delivering meaningful wage growth, the kind of economic imbalance the Fed tends to avoid encouraging.
In short: a rate cut next week is improbable. However, if inflation continues to trend downward in the months ahead—especially in the wake of new trade agreements—the September Fed meeting may offer a more straightforward path toward easing monetary policy.
What This Means for Metro Phoenix & Scottsdale Real Estate
While economic policy and trade talks dominate national headlines, their effects are already showing up in local housing markets—especially in Metro Phoenix and Scottsdale.
Here’s what we’re seeing on the ground:
- Inventory is building. Homes that once sparked bidding wars are now taking longer to sell, giving buyers more time and choices.
- Buyers are negotiating again. We’re watching well-informed buyers secure discounts, negotiate closing costs, and even ask for repairs—strategies that were almost impossible during the peak of the seller’s market.
- Sellers are adjusting. Some are pricing more competitively or offering concessions upfront, knowing today’s buyer has more leverage.
Why This Market Shift Matters
The Fed’s decision to hold rates steady might not seem like breaking news, but for real estate buyers, it’s quietly reshaping the playing field. Without another rate cut, mortgage rates may hold their current levels—or even climb slightly—keeping some would-be buyers on the sidelines.
But for those still in the game, this is an opportunity.
Today’s environment favors thoughtful negotiation and patience over urgency. Buyers who were edged out during the high-frenzied market of 2021–2022 are finding room to breathe—and to make deals. This is your chance to take control of the buying process and secure a deal that works for you.
Bottom Line
The U.S.–Japan tariff agreement may lower the temperature on global trade disputes, but it’s not enough to move the Fed just yet. Rate cuts remain off the table—at least in the short term.
However, for buyers in Phoenix and Scottsdale, this moment in the market represents something rare: increased inventory, less competition, and more negotiating power. If you’ve been waiting for the right time to re-enter the market with options and leverage, that time may be now. And even if it’s not now, the future is looking brighter for buyers in these markets.
