It won’t be the two- to three-point interest rate cut that President Donald Trump has been demanding.

But it appears the Federal Reserve’s leaders, amid signs of a weakening U.S. economy, might just be prepared to finally lower the benchmark short-term interest rate at their next meeting in September, perhaps by half a point, according to published reports.

The question is: Will it be enough to boost New Hampshire’s commercial real estate economy?

“It might help get going some of the projects that were already queued up,” said Andrew Martino, senior project manager at Bedford-based Harvey Construction, which handles a mix of commercial and residential construction projects across the state. “A rate cut lowers borrowing costs. It’s cheaper money. It could unlock some deals.”

But how many deals?

Housing Could Get Help

New Hampshire developers and commercial brokers agree that a small rate reduction may impact the residential real estate market by lowering mortgage costs for homebuyers.

“A rate cut will help [residential] real estate a little,” said Eric Jackson, director of acquisitions and development at the Nashua-based Stabile Companies, a major homebuilding company in the state. “People on the [buying] sideline might come off the sideline.”

But a half-point rate cut won’t be enough to fundamentally change the dynamics of large-scale multifamily and other commercial development projects, Jackson said.

Chief among the concerns: the overall state of the U.S. economy.

“There’s so much uncertainty out there,” said Jackson. “There’s inflation. There are tariffs. Construction prices are high and showing no signs of changing. It’s a tough call [for major developers].”

Rates will need to be cut significantly more than a half point to help commercial development, writ large, he added: “A small cut won’t move the needle much.”

Worries for NH Economy

The state of the economy concerns many commercial real estate figures across the state.

New Hampshire’s economy looks solid – with an unemployment rate of only 3.1 percent, lower than the national average of 4.2 percent, itself a relatively strong number.

But the July employment report showed a significant decline in U.S. jobs growth – with only 73,000 payroll positions created last month and with employment growth revised downward for May and June.

The disappointing jobs numbers prompted a furious Trump to fire the head of the Bureau of Labor Statistics, which compiles jobs-related data for the U.S.

Wall Street initially reacted to the July jobs report, as well as corresponding news of expanded U.S. tariffs on imported good, by pounding stocks downward.

But stocks later rallied to record highs amid hopes the Fed might lower interest rates in an attempt to boost the struggling U.S. economy.

Then July’s inflation report came out, showing the consumer price index holding steady at around 2.7 percent, higher than the Fed would like but not alarmingly so.

Meanwhile, U.S. treasury yields have been volatile of late, initially falling after the July jobs report came out, then rebounding a bit to settle in at around 4.3 percent.

Add it all up – and you have a mixed bag of economic news.

Little Room for Optimism

Still, Treasury Secretary Scott Bessent surprised many by recently predicting a Fed rate cut next month – and most Wall Street players think he’s probably right.

Yet Bill Norton, owner of Manchester-based Norton Asset Management, thinks a small rate cut is much ado about nothing.

“It’s all politics,” he said of Wall Street’s guarded optimism about rates potentially coming down next month. “The markets will take any good news they can get.”

Norton said he doesn’t see a lot of room for optimism on either the residential front or in other commercial real estate asset classes.

He noted that many commercial borrowers are facing 10-year balloon-mortgage adjustments that could see their loan rates more than double – with or without a small Fed rate cut.

“A Fed rate reduction is not going to give us a great big burst of activity in commercial real estate,” he said. “You might get a tick up in activity, but it’s not going to be a game changer,” he said.

Existing Assets vs. New Development

The purchase of some commercial properties might become slightly more attractive to investors due to lower rates.

“But the numbers are still tight,” he said.

And they numbers will remain even tighter for both residential and commercial development projects, he said.

“There’s so much going on in the economy. You don’t know what’s going to happen next. Right now, I think the economy is Trump’s Achilles heel,” Norton added.

Thomas Balon, manager of Concord-based OneKph LLC, agreed that commercial loan rates need to fall significantly from their current 6.5 to 7 percent levels in order to truly generate new CRE activity.

And a half-point reduction is simply not a significant enough fall.

“It’s not going to do much,” he said. “Mathematically, it means little.”

Balon, whose company is currently developing the $40 million mixed-use 70 Maplewood project in Portsmouth, said a full-point cut, at minimum, is needed to get some developments off the ground.