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Lowest Interest Rate
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as of 3 Jul 2026
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The Fed's Latest Decision and What It Means for You
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Written 22 Jun 2026
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In our January newsletter, we shared that the market was expecting interest rates to bottom out in Q2 2026, leading to higher interest in Singapore's property market.
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Singapore's mortgage benchmark, SORA, is driven by domestic money market conditions, but it is also influenced by global interest rate trends. As the U.S. Federal Reserve plays a significant role in shaping global interest rates, its decisions are closely watched by markets around the world.
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While no one expected rates to fall overnight, the consensus was that the U.S. Federal Reserve would begin cutting interest rates once inflation moved closer to its target. At that time, it seemed to be a reasonable expectation based on the data available.
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On 17 Jun, the Fed revised its inflation forecast for the end of 2026 upwards from 2.7% to 3.6%, signalling that inflation may remain elevated for longer than previously anticipated. As a result, there is a possibility that interest rates can remain higher for longer, with further rate hikes. (Source: Reuters, CNBC)
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At the same time, the Fed still expects inflation to slow more in 2027, allowing interest rates to gradually ease over the following years. In other words, we may still see lower interest rates, but not as soon as previously expected.
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Singapore's local interest rate expectations can change with every Federal Reserve meeting, and while forecasts provide useful guidance, they are not guarantees.
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Rather than making decisions based solely on where you think rates might be heading, it is often better to plan based on what we know today and ensure your mortgage remains suitable for your current financial situation.
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If your lock-in period is ending or you're considering refinancing, review the options available now. Should market conditions change in the future, you can always reassess your strategy when new information becomes available.
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The goal is not to predict the market, it is to make well-informed decisions most suitable for you.
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Understanding interest rate movements can be challenging, especially when market expectations change. If you'd like to discuss your options, our mortgageplus consultants are happy to provide another perspective.
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