Fed official urges July cut to ‘restrictive’ interest rate 

Will the Federal Reserve cut short-term interest rates during its next meeting? No one knows for sure, but a Fed official who has been pushing for a rate cut doubled down this week.

Meanwhile, President Donald Trump extended a 90-day pause on the steep trade levies he introduced in April and made some new tariff announcements. Elsewhere in Washington, D.C., the Department of Housing and Urban Development (HUD) terminated policies designed to eliminate bias in the home appraisal process, and Federal Housing Finance Agency (FHFA) Director Bill Pulte revised the credit score policy for lenders.

Is a July rate cut still on the table?

It should be, according to Fed Gov. Christopher Waller. While speaking at the Federal Reserve Bank of Dallas on July 10, Waller said he has advocated for a rate cut since November 2023 and believes any inflationary impacts from tariffs — a concern Fed Chair Jerome Powell has voiced — would be short-lived.

The current rate is "still pretty restrictive," Waller said, and the Fed "could consider cutting the policy rate in July."

"I'm kind of in the minority on this, but I've tried to lay out very clearly in economic terms why we could do this," Waller added. "It's not political."

While Trump and Pulte have criticized Powell — and called for his resignation — over the Fed's decision to keep rates frozen since December 2024, the Fed chair has said there is no rush to make a change and that monetary policy is guided by economic data, not politics. 

Resignation rumors? 

Despite his frustrations with Powell, Trump told reporters "no" when asked on July 11 if he will fire the Fed chair, even after alleging that Powell is "costing our country a lot of money."

But on the same day, Pulte released a statement saying he was "encouraged by reports" that Powell is thinking about resigning, though he did not provide sources for any such reports. "I think this will be the right decision for America, and the economy will boom," Pulte said. 

A spokesperson for the Fed declined to comment on Pulte's statement but reiterated that Powell has repeatedly said he intends to serve out his term. 

Office of Management and Budget (OMB) Director Russell Vought also criticized Powell in the wake of Pulte's calls for a congressional investigation into renovation plans for the Fed's headquarters. Powell's remarks about the renovation during a June congressional hearing "led to some serious questions that now require additional oversight," Vought said in a July 10 social media post.

"The Fed has just mismanaged the institution," he later told CNBC.

Trump sets new tariff deadline, proposes 35% tax on Canadian goods

Trump has extended his tariff deadline, which was slated to end on July 9, to Aug. 1. While most trade negotiations are ongoing, Treasury Secretary Scott Bessent recently said he believes all deals will be "wrapped up by Labor Day."

In the meantime, Trump has threatened to raise tariffs on Canadian goods to 35%. Canadian Prime Minister Mark Carney said he will continue to advocate for his country's workers and businesses as negotiations continue.

Trump also introduced a 50% tariff on copper — which the National Association of Home Builders noted is "in line with the rates enacted on steel and aluminum in June" — and told NBC News that he plans to raise blanket tariffs on most trade partners from 10% to 15-20%.

A major credit score policy shift

Pulte, who chairs the Fannie Mae and Freddie Mac boards, announced this week that both enterprises will start accepting VantageScore 4.0 credit scores, a change that he said will "increase competition to the Credit Score Ecosystem."

The National Association of Realtors praised the move, noting that it will give potential buyers "an extra boost that can either qualify them for a mortgage or reduce the cost of the loan."

"This is a major step toward a more accurate and equitable mortgage underwriting process, one that considers timely rent, utility and telecom payments as indicators of creditworthiness," said Shannon McGahn, NAR's executive vice president and chief advocacy officer. "These are real-world factors that show how people pay their bills and should count when determining if someone qualifies for a mortgage."

The policy shift is not immediate, however. As initially reported by Inman on July 16, the FHFA said Fannie Mae and Freddie Mac "are completing the final steps for delivery of loans scored using VantageScore 4.0," after which both GSEs will update their Selling Guide policies. For now, "existing Selling Guide and other requirements remain in place."

HUD guts PAVE task force policies

Property Appraisal and Valuation Equity (PAVE) task force policies aimed at removing bias from the home appraisal process have been thrown out, HUD and OMB officials announced this week. Ending the policies, which were introduced during President Joe Biden's administration, "eliminates unnecessary regulatory hurdles imposed on lenders, appraisers, and other program participants" and will help the FHFA "better serve" buyers and homeowners, according to a HUD press release.

"By tearing down these onerous hurdles, we're freeing professionals from a tangle of red tape that drove up costs, inhibited access to homeownership, and discouraged market participation," HUD Secretary Scott Turner said.

This story was updated on July 16 to reflect new information from the Federal Housing Finance Agency.