Most of the factors that affect interest rates are obvious, and easy to watch. Once in a while something comes out of left field that has a major impact, however. Today is one of those days. Background on Data to Watch The most common index that mortgage-rate watchers follow is the 10-year U.S. Treasury Bond...
Debt Ceiling News – Averting a Disaster
Now that the leaders in Washington have come to an agreement, debt ceiling news is all rosy. As a result, the stock market rallied, and long-term interest rates moved down this week. What will happen now? First, the stock market rallied as investors breathed a sigh of relief that our leaders were not going to...
Mortgage Interest Rate Update
Just a quick interest rate update. Rates have risen over the last week due to uncertainty about the debt ceiling negotiations, and whether the U.S. Treasury will continue to pay its bills. Let’s look at the chart below. The blue line tracks the yield on the 10-year U.S. Treasury Certificates (AKA T-Bills or Treasury Bonds.)...
The Fed Wants Lower Mortgage Rates
The Fed wants lower interest rates. What? You heard just the opposite? No, you just think you heard the opposite. They raised the discount rate, which immediately brought mortgage rates down across the board. I’m using shock value, of course, but it’s true: The Fed wants lower mortgage rates, or at least the economic conditions...
Mortgage Rates Are Falling
Mortgage rates are falling because the Fed raised interest rates. That makes more sense than you think. Yes, I know that when the Fed announces yet another raise in interest rates next week, you’ll see ads screaming “The Fed is raising interest rates! Apply now before rates go up!” The point of those ads isn’t...
Inflation is Finally Cooling – Maybe
Inflation—you can’t live with it, you can’t live without it. Well, most of us would prefer to live without it, but zero inflation only exists when the economy stagnates and drives unemployment up and wages down. But inflation is on our minds this year because we’ve become accustomed to not having to live with it....
Mortgage Interest Rates Today – Have We Turned a Corner?
Well, the wild ride continues. As I’ve written before, the three most important factors in interest rates are inflation, inflation and inflation. How is this impacting mortgage interest rates today? Closer Look: Inflation and Mortgage Rates What We Know About the Relationship (loanguide.com) Inflation, Inflation, Inflation After running under 2% annually for years, inflation took...
Fed Rate Hike – What Does It Mean?
The Board of Governors of the Federal Reserve Bank (The Fed for short) met today (3/16/2022) to discuss monetary policy. At the end of the meeting, they announced a Fed rate hike. The Fed has a dual mission – to keep the economy growing, and to keep inflation low. These two goals conflict with each...
Interest Rate Update
5/17/2022 | No surprise, interest rates are up. What is surprising is that they have gone up faster and farther than I’ve seen before in my time in the industry. (That’s, umm, well, a long time.) How high have they gone up, and will it last? The three most important factors in interest rates are...
Fed Raised Interest Rates – Or Did They?
You will hear lots of chatter that the Fed raised interest rates in mid-December. But is that true? On December 15th the Governors of the Federal Reserve (The “Fed”) announced that they were beginning to worry that inflation might be taking hold in the U.S. after all. In order to reduce the possibility of inflation...