Mortgage rates saw a decent amount of volatility this holiday shortened week (up one day then down the next) alongside the release of the minutes from the last Fed meeting that were a little more dovish than expected and continued uncertainty in Europe surrounding the possibility of Greece defaulting on their debt and potentially leaving the European Union.
The main market mover this week was the release of the Fed minutes on Wednesday, with the discussion from the last meeting showing that many Fed officials were inclined to keep rates at zero longer than expected. Many Fed officials noted felt that dropping the term “patient” from the Fed statement could lead markets to become more date focused on the next rate change, and they agreed that policy should remain data dependent. Many Fed officials also noted additional risk from overseas surrounding China, the Middle East, Ukraine, and Greece. While the overall tone of the report was dovish and supported lower rates for longer, it should be noted that the meeting occurred before the January Non-Farm payrolls report that was much better than expected.
Greece continues to be in the spotlight this week, seeking a loan extension plan that was rejected by Germany as the country continues to struggle with their debt and could run out of funding in the next few weeks. With the more fiscally responsible Germany rejecting the plan, it seems that other euro zone finance ministers are unlikely to approve another loan extension for the country as they have failed to meet all of the austerity measures that would dictate an additional bailout. News of a last minute agreement to restructure the debt sent rates heading back up by the end of the day on Friday. Rates will continue on the current “roller coaster ride” and will be dependent both on current economic trends and data along with likely volatility from events in Europe.
Rates remain at historic lows and continue to support homeowners seeking to refinance as well as borrowers seeking to purchase a new home. To find out what current rates are or to obtain information about how to prequalify for a home loan, please feel free to contact me at email@example.com .
By: Michael Borodinsky
Vice President/Regional Builder Branch Manager | Caliber Home Loans
Call Michael: 732-382-2654
Email Michael: firstname.lastname@example.org