Mortgage rates were down this past week in the Freddie Mac Weekly Survey. The 30 Year Fixed Rate Mortgage was at 5.30% in today’s Freddie Mac survey results and the 15 Year Fixed Rate Mortgage was at 4.58%.
Yesterday afternoon the Federal Reserve raised the Fed Funds Rate target by 0.75%; after which longer term rates like the 10 Year Treasury went down. The Fed is also on a path to reduce the amount of mortgage and treasury securities on its balance sheet, know as tapering. Based upon most recent data available, the Fed’s approach to tapering has been very weak. (see chart below) Last week we anticipated further guidance or changes to the tapering plan. But Chair Powell said yesterday that asset sales are “broadly on track” but “slow to get going because some of these trades take time to settle.” There were no details on why it takes time to settle trades of the the most liquid mortgage securities and bonds in the world.
Mortgage rates are likely to remain volatile in this environment as the Fed tries to navigate this last half of the year. It’s still difficult to predict what may happen to rates if the Fed actually starts to taper according to the actual plan and not just “broadly on track” with their plan.
Freddie Mac’s Weekly Survey was released this morning with its most recent assessment of the mortgage rate landscape. See the details of their survey below.
(dynamic chart with current info)