The President personally "QE"? Trump announces $200 billion mortgage bond purchase plan

On January 9th, U.S. President Trump announced the launch of a $200 billion mortgage-backed securities (MBS) purchase program to lower mortgage rates and alleviate the housing affordability crisis. This move is seen by the market as Trump’s direct intervention in addition to the Federal Reserve’s rate cuts, effectively pushing his “personal version of quantitative easing (QE).” Trump posted on Truth Social that he has “instructed relevant representatives to purchase $200 billion worth of mortgage bonds” to reduce mortgage rates and monthly payments, improve homebuying capacity, and blame the current housing crisis on the Biden administration. Bill Pulte, Director of the U.S. Federal Housing Finance Agency, confirmed to the Financial Times that the program will be executed by Fannie Mae and Freddie Mac, without requiring Congressional approval. Under existing agreements, these two agencies still have approximately $200 billion in capacity for mortgage investments. Analysts note that this move is highly similar in form to the Fed’s policy after the 2008 financial crisis, which involved purchasing MBS to stabilize the market. Despite the Fed’s cumulative rate cuts of 75 basis points, the current 30-year fixed mortgage rate in the U.S. remains at 6.16%, keeping housing costs a political and economic focus. Against the backdrop of high inflation and rising living costs, Trump’s action is viewed as an attempt to directly intervene in housing and financial markets through executive power to boost voter confidence.