What’s Ahead For Mortgage Rates This Week — June 10, 2013

Housing Analysis , ,
Last week's economic reports provided a mixed bag of results. On Monday, the Department of Commerce reported that construction spending increased by 0.40 percent in April and fell shy of the expected reading of 1.0 percent, but exceeded the March reading of -0.80 percent. Home Prices Increase Fastest Since 2006 On Tuesday, CoreLogic released its Home Prices reported that the national average home price had increased by 12.10 percent year-over-year in April. The comparable year-over-year reading for April 2012 was 11.00 percent. This represents the fastest pace of home price increases since 2006. The national average home price expanded by…
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Fed Meeting Minutes Expose Rising Interest Rate Risk

Federal Reserve , ,
Minutes of the April/May Federal Open Market Committee (FOMC) recently released may have a significant impact on mortgage rates going forward.  One significant development from the meeting suggests that the present quantitative easing (QE)  program may be modified in the near future.  The current QE program involves the Fed purchasing $85 billion per month in mortgage backed securities (MBS) and Treasury bonds. The Fed's goal with QE is keeping long-term interest rates, including mortgage rates, low. Considerations mentioned in favor of slowing the current QE program include concerns over “buoyant” financial markets as evidence of a developing economic “bubble”. FOMC…
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What’s Ahead For Mortgage Rates This Week – April 8, 2013

Mortgage Rates , , ,
Last week's economic news includes several factors that drove U.S. mortgage rates lower. The Bank of Japan announced that it would increase its purchase of bonds by $1.4 trillion over the next two years.  This news caused yields on Japanese bonds to fall, which made U.S. bonds more appealing to international investors, that in turn increased MBS prices and caused mortgage rates to fall. Bumpy Employment Numbers Support Lower Interest Rates Other significant economic news involves an unexpected drop in the number of new jobs created last month. The Bureau of Labor Statistics (BLS) Nonfarm Payrolls Report issued Friday indicated…
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