Fed Holds Rates Steady as Markets Await Greater Clarity

The Federal Reserve continues to take a cautious approach, holding interest rates steady as policymakers weigh persistent inflation against signs of a slowing labor market. While the Fed remains open to future policy adjustments, most market participants expect rates to remain unchanged for the rest of the year.

Uncertainty surrounding inflation, global energy markets, and economic growth continues to influence borrowing costs. According to Marcus & Millichap, these conditions could keep long-term interest rates elevated, meaning commercial real estate financing may remain relatively expensive in the near term.

Looking further ahead, a more disciplined monetary policy and gradual balance sheet reduction could create a healthier lending environment for commercial real estate. While the transition may take time, a more stable interest-rate landscape would support long-term investment activity and underwriting discipline.

What This Means for Investors

Higher borrowing costs continue to challenge acquisitions, but long-term fundamentals remain intact. Investors who stay disciplined and focus on quality opportunities may be well positioned as financing conditions gradually improve.

Source: Marcus & Millichap Research Brief – Financial Markets, May 2026.