The Week in Review:
The big news last week was the Fed’s decision on how they will continue to help keep interest rates low. They decided to fulfill their commitment to buy $1.25T in Mortgage-Backed Securities. However, instead of buying all by the end of the year as originally planned, they will spread the remaining purchases out through the first quarter 2010.
On the week, home loan rate improved about .125%
What to Expect:
What does the Fed announcement mean? The announcement indicates that they will wean themselves off of the program and let the market correct slowly vs. an immediate termination of the program at year end. If you have read my rate updates for any length of time, you know I have been talking about this event. Home loan rates are slated to rise as the Fed’s presence in the market diminishes.
As they say, the writing is on the wall. If you are in the market to buy or refinance, it’s time to take advantage of the rate environment.
Over the next week, we’ll receive plenty of information about the state of the economy. On tap this week are the Consumer Confidence Report, the Core Personal Consumption Expenditure Index and Friday’s Jobs Report.
Breg-ometer:
Next 7 days: Rates could increase just a bit depending on the news of the week
Next 30 days: Still expect to be in the same range
Next 90+ days: Rates Up