Fed Sees Risk of Big Declines in Still-Lofty US House Prices
- Home prices could be ‘particularly sensitive’ to shocks: Fed
- Liquidity in Treasury market is ‘strained,’ Fed says
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The Federal Reserve suggested on Friday that lofty home prices could be susceptible to steep declines after big run-ups in recent years on the back of ultra-low interest rates.
“With valuations at high levels, house prices could be particularly sensitive to shocks,” the Fed said in its semiannual Financial Stability Report released Friday.