Mortgage rates were up this past week in the Freddie Mac Weekly Survey. The 30 Year Fixed Rate Mortgage was at 5.55% in today’s Freddie Mac survey results and the 15 Year Fixed Rate Mortgage was at 4.85%.
Last month the Federal Reserve raised the Fed Funds Rate target by 0.75%. 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 tapering is starting to pick up the pace. (see chart below) The plan has the balance sheet below $8.4 trillion at the end of 2022 and below $7.3 trillion at the end of 2023. The Fed will need to significantly ramp-up the process of getting assets off the balance sheet if it wants to meet stated goals. They were supposed to taper $95 billion in September, but have only reduced the balance sheet by about $65 billion all summer, less than half of what they said they would do.
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 or when the Fed starts to taper according to the actual plan.
(dynamic chart with current data)
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 data)