Mortgage Rate Update February 29, 2016
Mortgage rates are similar or slightly worse compared to Thursday.
Interest rates here in the US continue to be influenced by international storylines. China’s central bank announced today that it will cut reserve requirements on Chinese Banks in an effort to boost lending in their economy. Asian stock markets reacted negatively to the news which provides support for the “flight-to-safety” trade that helps US interest rates remain low.
In a separate release inflation figures out of Europe were reported very low earlier today. The report makes it more likely that the European Central Bank will expand its quantitative easing measures when they meet again in March. That expectation will encourage demand for US dollar denominated assets and make it harder for US interest rates to increase.
In domestic housing news the National Association of Realtors released its monthly pending home sales report. It showed the numbers of homes pending in the US declined last month but is still 1.4% higher than a year ago. Harsh weather on the east coast and lack of supply were credited with the decline.
Looking ahead it is jobs week and the rest of the economic calendar is busy. From a technical perspective mortgage rates look safe so we’ll maintain a floating bias.
Current Outlook: floating bias