Homebuilder Stocks Decline As Fed Hikes Interest Rates And Unwinds (Rez Construction Spending Growth Declining)

The bloom is off the rose for homebuilders. Yes, it had been a great run, fueled by The Fed’s zero-interest rate policy (ZIRP) and asset purchases (QE). But despite a roaring economy, SPDR S&P Homebuilders ETF have been falling since January as The Federal Reserve Open Market Committee (FOMC) sticks to their guns and keeps normalizing interest rates.

spdrhbfed

Yes, the Fed Dots Plot project indicates that there is still upside momentum to short-term interest rates.

feddotsplots

And the Fed’s System Open Market Accounts (SOMA) show a declining inventory of Treasury Notes and Bonds to let mature.

somadist

So, let’s put on some groovy pants, put on Iron Butterfly, and chill.

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