WASHINGTON — The outlook for the housing market darkened further yesterday as the nation's largest buyer of home mortgages said it racked up more than $2 billion in quarterly losses and forecast a steeper drop in home prices this year.

If Fannie Mae's prediction proves true, the real estate woes could further shake the confidence of consumers already stung by rising food and fuel prices, and by an anemic job market.

Home foreclosures are accelerating around the country, adding to the glut of unsold properties and further depressing prices. As a result, a growing number of homeowners are saddled with loans that outstrip the value of their houses.

"I think that right now we are in the belly of the cycle," Fannie Mae's president and CEO, Daniel Mudd, said during a conference call with analysts.

Mudd said home prices fell in the first quarter "faster than anyone anticipated" and that the company foresees a decline of 7 percent to 9 percent for the year, instead of the earlier forecasts of a 5 percent to 7 percent drop.

Still, investors pushed Fannie's shares sharply higher as federal regulators loosened the company's capital requirements so it can play a bigger role in the mortgage market and help stabilize housing. Fannie shares jumped nearly 9 percent, or $2.52, to $30.81 in trading yesterday.

Nevertheless, the rising tide of delinquencies and foreclosures is a considerable risk to the broader economy, Federal Reserve Chairman Ben Bernanke warned Monday as he urged Congress to take additional steps to alleviate the problems.

When businesses see consumer confidence buckling under the housing slump, they too start to cut back, noted Michael Gregory, senior economist at BMO Capital Markets in Toronto.

The tax rebate checks arriving in Americans' mailboxes may mitigate the chill for a while, but eventually the weakness in the housing market "will continue to drag down consumer spending," he said.

"Is the average American prepared to step up and take out a loan and buy a house? Probably not," Gregory said.

Economists say the stricken housing market is souring the mood of consumers, the most powerful force in the economy. Higher prices for food and fuel are also squeezing household budgets.

The nationwide average price of gas yesterday was $3.61 a gallon, an increase of 20 percent from a year earlier, and relief does not appear to be coming anytime soon, with some experts predicting an average price of $4 in the weeks ahead.

Crude oil futures leapt to a new record near $123 a barrel yesterday as supply fears dominate the market psychology. And a Goldman Sachs analyst predicted yesterday that oil prices could rise to $150 to $200 a barrel within two years.

Amid rising prices of grains and feedstock, Americans are also paying higher prices at the grocery store. Egg prices have jumped 40 percent in the last year and flour prices are up 50 percent since January, raising the price of bread and cereal.

To help stabilize housing and the overall economy, which many economists say is on the precipice of its first recession since 2001, the Federal Reserve embarked last fall on its most aggressive interest-rate-cutting campaign in decades.

Fannie, meanwhile, has been encouraged by the government to step up its purchases of mortgages to provide some relief to the housing market. In recent months, Fannie and its smaller government-chartered sibling Freddie Mac have bought up hundreds of billions of dollars in additional mortgages, and three-quarters of mortgage-backed securities are now issued by the two companies.

Fannie's federal regulator, the Office of Federal Housing Enterprise Oversight, yesterday said it will reduce the capital cushion the company has to maintain. After it raises an anticipated $6 billion in a stock sale, Fannie will be required to keep surplus capital of 15 percent of its total mortgage debt, down from the current 20 percent.

But analysts worry Fannie and Freddie may be taking on too much financial risk as foreclosures continue to mount. Some critics have said that allowing the companies to take on more debt could threaten the global financial system.

Fannie lost $2.2 billion, or $2.57 a share, in the January-March period, compared with a profit of $961 million, or 85 cents, in the first quarter of 2007.

Its losses from soured home loans were greatest in California, Florida, Michigan and Ohio.