Company: CHMI-PB
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001140361-25-017536
Chunk: 6

Company: Cherry Hill Mortgage Investment Corp
Filing Date: 2025-05-06
Form: 10-Q
Item: Item 2
Chunk 6
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 per share and paid aggregate brokerage
            commissions of approximately $11,900 on such repurchases. The difference between the consideration transferred and the carrying value of the preferred stock repurchased resulted in a gain attributable to common stockholders of $78,000 for the
            year ended December 31, 2024. Shares of preferred stock that are repurchased by the Company cease to be outstanding but remain authorized for future issuance.

            48

              Table of Contents

          Effects of Federal Reserve Policy on the Company

            Since December 18, 2024, the federal funds rate target has remained steady at 4.25% to 4.5%. This decision followed three consecutive rate cuts
              starting from September 18, 2024, totaling a 1.0% decrease. The September 2024 cut was the first in four years, following a period of tightened monetary policy in 2022 and 2023 to combat high inflation, which peaked at 9.1% in June 2022. By
              March 2025, inflation had declined to 2.4%.

            The Federal Reserve has indicated its readiness to adjust monetary policy if new risks arise. Additionally, it has slowed the runoff of its balance
              sheet. On April 1, 2025, the monthly redemption cap on U.S. Treasury Securities was reduced from $25 billion to $5 billion, following a previous reduction from $60 billion to $25 billion in June 2024. The $35 billion cap on agency debt/MBS
              remains unchanged, with excess principal payments reinvested in U.S. Treasury securities.

            Recently, Federal Reserve Chair Jerome Powell has indicated that the imposition of significant tariffs in the U.S. would likely cause inflation and
              unemployment to rise, threatening the Federal Reserve’s dual mandate to pursue maximum employment and stable prices. However, he said that the Federal Reserve will await taking action until the data demonstrates the impact of any new tariffs
              on the U.S. economy.

            To the extent the Federal Reserve takes future action to ease monetary policy by reducing its federal funds rate and/or further reduce the speed at
              which it is decreasing its balance sheet, it will generally lower interest rates across asset classes, including for Agency RMBS. Lower rates could reduce our funding costs and spur economic activity, increasing our net interest income.
              Higher prepayment could reduce the length of cash flows from the MSRs and accelerate the premium amortization on the RMBS portfolio. In