Mortgage rates began trending higher last week, as the limited amount of economic news that came out was not as dire as expected. While the economy continues to run at a sub-par level, there is some evidence that we may not drop as far, or last as long, as some have been predicting. With inflation refusing to behave, signs of stability are increasing the chances that the Fed will stand pat on rates.
This week is huge in terms of important events and data for financial markets. There is a moderate likelihood that the Fed will trim rates another '/4-point on Tuesday. However, this is unlikely to help mortgage rates, as they have been held in check by growing inflationary concerns. We could see mortgage rates begin to climb aggressively if GDP for the 1st quarter comes in above 0.8% or if Friday's Employment Report is much better than expected. Either of these would indicate that the economy might be faring better than thought. This would free the Fed to return to focusing efforts on fighting inflation, which could lead to the possibility of higher interest rates later this year.
It is still a good time to take advantage of historically low home loan rates before more inflation talk pushes them higher. I'm always here to help advise you, your friends, and your colleagues.
Paul Cantor is a mortgage planner at TrustMor Mortgage Campnay. He may be reached at (804) 433-1510 or on the web at www.PaulCantor.com
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment