Current Mortgage Rates & Market Trends

After the March 13 Fed statement, mortgage rates swiftly moved higher, but they have since improved and are close to where they were prior to the announcement. Last week, Fed Chief Bernanke clarified the Fed's current position, causing investors to scale back their reaction to the Fed statement. This week, Fed Chief Bernanke again emphasized that the Fed is inclined to keep its very accommodative monetary policy in place to help the labor market. His comments suggested that if economic growth in coming months slows below expected levels, additional Fed purchases of mortgage-backed securities (MBS) remain a possibility. As a result, investors further shifted their outlook for Fed policy this week, investing more in the bonds market and helping mortgage rates improve.

Another factor which did contribute to rates improvement was the announcement of the Greek debt deal a few weeks ago, few headlines about Europe have been seen. This week, however, concerns about financial conditions in Europe emerged again as a significant factor. Spain was the primary source, as thousands of workers protested government cutbacks. To avoid a bailout, Spain must attempt to successfully implement austerity measures and still maintain a decent rate of economic growth. Weak economic growth in the euro-zone adds to the challenge to European market however boost the bond market in US, which may contribute to low mortgage rates in US!

For further assistance you can contact Dr. Shab Kavandi at American Select Funding, Inc. at 1-714-639-6694 for your free no obligation consultations

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