Trump used economic wins to push Fed rate cut

The Trump Administration pushed Fed Chair Jerome Powell on the decision — saying the rate cut would further fuel the economy, shrink the national debt and lift the housing market. Meanwhile, the Federal Reserve pushed back — calling the cut 'support for a slowing job market’, with lingering inflation remaining a concern.

Dean Lyulkin, the CEO of a small business lender called Cardiff told me "The economy has room, and this isn’t a one-and-done. There’s only so many times a chair can swat away Trump’s tweets about cutting rates before he finally bends, at least a little, to the will of the White House.”

For current homeowners and prospective buyers, the rate cut means one thing: potentially lower mortgage rates.

U.S. mortgage rates dropped with the Fed’s decision last week, according to the federal home loan mortgage corporation Freddie Mac, subsequently spiking the share of mortgage refinance applications nearly 60%, their highest mark since January 2022. Although they vary by product and lender, the national average on a 30-year fixed mortgage rate now sits at roughly 6.26%.

And what about those high insurance premiums to protect your home?

While the most common factors contributing to what homeowners pay for coverage include location, deductibles, claim history and credit score, premiums are also impacted by the costs to build or repair a home. Lower mortgage rates often lead to a drop in construction prices, which can lower the price tag for home insurance, as the rate to borrow money along with the price of building materials and labor recedes together.

Right now, the average cost to insure a home is $2,802 per year, despite significant variation across different regions of the U.S. As recently as August, insurance premiums were rising 8.7% faster than the average rate of inflation during 2025, with costs continuing to rise for homeowners in certain locations and with particular claims histories.

When and if lower mortgage rates spur a cost-reduction in home insurance is up for economic debate and will play out in a thousand headlines for weeks to come. For beleaguered homeowners, pummeled by inflated prices across the board, a reprieve in at least one category of their budget ledger can’t come soon enough.

Interest rate cut history since March 2020:

• During the Covid-19 pandemic on March 3, 2020, the U.S. Federal Reserve reduced the target range of federal funds rate from 1.58% to 1%.
• On March 16, 2020, the Fed made an even bigger cut to interest rates, slashing the target range to between 0% and 0.25%.
• In September 2024, after a series of rate hikes to curb inflation, the Fed lowered rates for the first time since the pandemic, cutting 50 basis points to a target range of 4.75% and 5%. According to Forbes, the Fed then cut rates by 25 basis points in each of the next two months, before choosing to maintain a range of 4.25% to 4.50% at its meetings in January, March and May 2025.
• On Sep. 17, 2025, the Fed lowered its benchmark interest rate by a quarter-point to a range of 4% to 4.25%.

See also:

• Insurance will tell you everything about the U.S. economy
• Insurance stocks outperform as investors pile on
• Most U.S. workers can’t afford sick leave